Jonathan Oxley, chairman, Institute of Directors in Yorkshire and the Humber
As the digital technology sector experiences rapid growth, Yorkshire and the Humber will play a key role in driving efficiency and productivity for UK manufacturers.
Digital services include creative media, cyber security, telecoms, fintech, medtech and data analytics.
The government estimates that the global digital services market will be worth as much as the entire UK economy by 2020 and plans to spend £30m a year over four years to support innovative digital business projects.
A Digital Services Bill is working its way through Parliament which aims to ensure that the necessary infrastructure is in place.
The UK's digital economy is the largest amongst G-20 countries as a proportion of GDP and is expected to account for more than 12 per cent of UK GDP in 2016.
Yorkshire and the Humber is at the forefront of the digital industries with the Leeds city region alone producing more than 15,000 graduates in STEM subjects. It is home to thousands of digital technology companies, as well as Sky Bet, NHS Digital and the only Digital Health Enterprise Zone in the North.
However, we should not forget that Britain has a great manufacturing and engineering heritage and it is a mistake to assume that this is fading into irrelevance when compared with our massive service sector and the fast growing digital tech sector.
The effect of innovation and development in technology, including digital technology, is that manufacturing can become more advanced and more efficient.
That efficiency (together with other factors including cyclical following winds such as the currently low exchange rate on sterling helping our exports) means that Britain is and will continue to be a major manufacturing country.
It is estimated that, due to technology and other factors, manufacturing productivity as measured by output per hour has grown three times faster in manufacturing than the whole economy over the last decade.
According to EEF's latest figures, the manufacturing sector employs 2.7 million people, accounts for 10 per cent of the UK GVA ("gross value added") and around half of our exports.
Britain is the ninth largest manufacturer in the world and about a quarter of factory output is exported. The US and Germany are, by some distance, our main markets followed by the Republic of Ireland, China and a number of other European countries. We also have a big domestic marketplace.
Across the UK the biggest areas of manufacturing are food and drink, transport equipment, aerospace and defence, chemicals and electronics.
Here in Yorkshire and the Humber we produce £16.2bn of manufacturing output (16 per cent of UK total output) with around 285,000 people (around 10.5 per cent of the total workforce) engaged in manufacturing.
Our region is developing specialist hubs and clusters such as the Advanced Manufacturing Research Centre in Sheffield which provides world-class research services for companies such as Boeing, Airbus, Rolls Royce and BAE Systems as well as supporting local businesses.
The Fourth Industrial Revolution (4IR), which will see ever increasing integration of methods of production with digital and other technologies to increase productivity, is underway.
Because the connectivity provided by digital technology is going to drive that revolution and the processes of manufacturing in the future, we can be confident that our strength in digital innovation will drive the success of our manufacturing industries into the 2020s and beyond.
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Notes to editors
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