http://www.pcpro.co.uk/news/enterprise/ ... ny-uk-fabs

Curious to know what people make of that...

It would appear from the article that the government has been going after R&D type hi-tech jobs rather than the actual fabrication jobs.
Could be a case of myopia in the government - pushing for more university graduates means more R&D type employment, ignoring the fact that something like wafer fabrication also requires a similar level of education.

Plus, wafer fabrication is, IIRC, not exactly a clean process in terms of environmental impact.

As an aside, don't they have volcanoes in or near Japan? Or do they just not produce ash clouds.

i spose we'd get cheaper CPUs if they didnt have to be shipped in from abroad, wouldnt we?

I think that Intel were more interested in the tax incentives to set up shop in the UK. The problem is that any country that gives special treatment to multinationals effectively aids importing of jobs at the expense of every other nation. Ireland was practically a tax haven for manufacturers if they set up shop in Ireland. Whereas the UK did not give such tax benefits.

Unfortunately, it is typical of big, international businesses and national governments. They put pressure on the governments to subsidise their plant and give them big tax breaks. Whichever government can offer the biggest incentives, combined with a workforce with the lowest wages and a decent infrastructure, wins...

It has little of nothing to do with where the best labour is or target markets, it is purely based on who gives the biggest handouts/cheapest running costs. Throw in strong unions in the UK and it can very quickly become very unattractive. Eastern Europe is a huge boom, because of cheap labour, cheap land and governments looking at a growing nation and wanting to pull in more jobs and build up their economy. The "West" already has built up its economy and needs to support it, that isn't easy, because they can't compete on price and they can't offer the big handouts that would offset the high labour and land costs, because they are having to prop up an over inflated economy.

The UK does not really have strong private sector unions any longer. The BA union is mainly because of the history as a publicly owned company. The only solution is to target countries who give such tax breaks to new investment with a retaliatory tax on ALL their exports. Once no one is offering such tax breaks then no country is going to get an advantage by such means. Then companies will have to consider other factors. At the moment they can get such huge subsidies that it can distort the decision where to invest. Some countries offer tax free periods for a period of time so you get the problem of transfer pricing to avoid even more tax by shifting profits from on country to a lower tax country.

This country seems to be too geared up for serivce industries rather than manufacturing, probably not helped by the drop in people taking science/engineering at school/university. Shame really - we used to be good at it.

I'd agree, apparently this country doesn't value engineers anymore. We have an Italian friend who's full title is Doctor Engineer - I think the continent has a higher regard for the profession.

It could be helped by making university engineering degree courses free fro students. If they could get a degree with a pile of debt that might help a lot.

Actually we were never as good at manufacturing as our national mythology pretends, we have rarely - if ever - been a net exporter of finished goods. There was a brief period when we exported vast quantities of semi finished goods - mostly cotton thread which was to be dyed and woven in Prussia. The remainder was largely coal and iron in big unfinished lumps.

What Britain excelled at during the height of the industrial revolution was providing capital and resources for other nations to industrialise. So we would sell foreigners a couple of trains (one to teach the drivers, one to take apart so they could learn how to build their own) and lend them the money they needed to construct the tracks. In other words, financial services were the engine of British prosperity, not manufacturing (we lost out on hardware supply to the Belgians as often as not, but we still overwhelmingly supplied the capital).

There is also a persistent myth that manufacturing has declined in Britain. It has actually shown strong long term growth for over a century. Where there has been a decline is in the cheap crappy jobs that the sector used to create in abundance, and also in the level to which we depend on the sector for job creation. Manufacturing has grown, but less quickly than other sectors. This is no bad thing in itself, which is lucky because the declines are probably largely irreversible.

Only four things can make British labour competitive on the world manufacturing stage:
1. Specialisation in industries that are capital intensive and technically challenging enough that countries with cheap labour cannot gain access to the markets. Obvious examples are biotech, aerospace, pharmaceuticals, chemicals. Some of these are areas in which we already do very well, the remainder are ones in which there is intense competition to lure industries to certain regions - and much of the end product manufacture is still going to be exported to cheap countries.
2. Normalisation on standards of living across the majority of the planet. If the average Chinese worker earns as much as the average English one, they can buy more of our manufactures, and they can't undercut us very easily. This can be achieved by either waiting 50 years for their GDP per head to reach the same level as ours, or by a calamitous drop in our standard of living. I leave it up to you to decide which option you like best there.
3. Cross subsidy. Tax the rest of our economy specifically to subsidise the bit that sucks.
4. Keep inventing entirely new industries that nobody else has. This isn't actually as stupid as it sounds, unfortunately it isn't as easy either. Aerospace, electronics, computing, and automobiles were all brand new industries once upon a time, and the countries of origin have done very well on the proceeds. But the jobs and wealth invariably end up moving around and spreading out. Either way, it's the countries that invest in universities and other R%D resources that will create the next industrial booms, not the ones who spunk their cash on bringing current manufacturing trends within their borders.

If they built a UK fab and Joanna Lumley ran it, would it be an ab fab?