Latest ONS figures show an 8% decrease in textile production over the last two years – really?
This month the Office for National Statistics published a report about the current state of textile manufacturing in the UK. In the report they referred to the Index of Production, which is a report that the ONS create to show the volume of production year on year of Britain’a manufacturing industries. Above is a chart produced by the ONS that shows the amount of textiles, clothing and leathergoods manufactured in the UK over the last few decades, with 2011 as the base year used for comparison. Whilst you can see from the chart that manufacturing as a whole has grown, the textile sectors have been in sharp decline since the ’80s. In fact, it indicates that there has been an 8% drop in the production of textiles, clothing and leather goods since 2011.
This contradicts everything that I have been witnessing since I started this blog in 2011. I have seen a huge increase in demand not only from consumers wanting to buy British, but also from designers, brands and retailers wanting to make their products in the UK. The chart above shows the amount of searches for clothing, textile and leathergoods manufacturers on the Make it British website between Sept 2012 and January 2014. I also carried out a survey earlier in the year among some of the factories that I know and 26% said that business was better for them currently than in the previous year. Only 10% said that it was worse.
And when I launched our Meet the Manufacturer trade show this year exclusively for British manufacturers of clothing, textiles and leathergoods we were expecting around 700 visitors over the 2 days and instead we had nearly 3000. Nearly all of the big retailers had representatives at the show and we will be repeating the event next year at over double the size. That confident am I that UK fashion & textile manufacturing is growing in demand.
So these latest ONS figures showing our textile manufacturing industry to still be in decline came as quite a surprise. And when I raised this in a speech that I did at the Westminster Media Forum last week, which was attended by many industry figures, including MPs and representatives from Creative Skillset and UKFT, many concurred with my sentiments about the inaccuracy of the official statistics.
So how could the figures be wrong?
I believe that the difference in the decline shown by the official figures and the increase in demand that I am seeing comes down to the fact that many importers are still registered under a manufacturing SIC code. A Standard Industry Classification code is used by the Government to classify industry areas. When a company registers at Companies House they choose a SIC code to classify their business under, and there are several codes for manufacturing. The ONS uses the data obtained from companies that are registered as manufacturers to help determine their report on UK manufacturing production. However, what if the companies that are registered as manufacturers are in fact now importing goods made overseas, and yet are still registered under a manufacturing SIC code?
I did a quick check at Companies House on some of the businesses that I know to be importing clothing into Britain and found nearly all of them to still be registered SIC codes beginning with 14, which defines them as ‘manufacturers of wearing apparel’. And I also checked on some of the factories that I know that have recently brought production back to the UK and found them to be registered under such codes as SIC 46160 ‘Agents involved in the sale of textiles, clothing, fur, footwear and leather goods’, which would not come into the manufacturing statistics at all.
If all these companies are incorrectly registered, how can we be sure of the true value of British textile manufacturing?
My thoughts are that there needs to be a Nationwide study to ascertain exactly how many manufacturers we have here within the UK. I personally have a pretty good idea of who and where they all are, but no one knows for sure. Only with a realistic picture of the size and growth of the industry can we ensure that we create and support the capacity that will be needed to keep up with the increase in demand from designers, brands and retailers that want to bring manufacturing back to the UK.