Parliamentary Search

Commons Debate pack by Saywah Mahmood. It was first published on Wednesday, 12 November 2025. It was last updated on Friday, 14 November 2025.

Contribution of the specialist manufacturing sector to regional economies

Background

Manufacturing remains an important part of the UK economy, with well-established clusters across many regions.

Manufacturing-intensive sectors feature prominently in the Government’s modern industrial strategy, published in June 2025.

The strategy outlines a ten-year plan that the Government says is intended to create conditions that support business investment across the UK, raise living standards, strengthen economic security and resilience and support the transition to net zero greenhouse gas emissions.

The Government has identified eight “growth-driving” sectors (the IS-8) for targeted support under the strategy. Each sector has its own individual sector plan, which provide detail about each industry and specific policy interventions and targets for each sector.

Two of these, advanced manufacturing and defence, are directly relevant to specialist manufacturing.

Economic output and employment in UK regions and countries

Advanced Manufacturing

The tables below show gross value added (GVA) and employment in advanced manufacturing. 

Two side-by-side tables showing 2024 advanced manufacturing jobs and 2023 advanced manufacturing economic output across UK regions and nations. Left table: Advanced manufacturing jobs (2024) Lists regions with the number of jobs and each region’s share of total jobs. The North West has the highest figure at 102,000 jobs (2.8%), followed by the West Midlands at 96,000 (3.6%) and the South East at 95,000 (2.2%). Other regions range from 86,500 jobs in the South West to 16,000 in London. Northern Ireland data is for 2022, showing 26,076 jobs (3.3%). Right table: Advanced manufacturing economic output (2023, GVA) Shows gross value added (GVA) in billions and percentage of total GVA. The North West has the highest GVA at £14.4 billion (5.9%), followed by the West Midlands at £11.8 billion (6.7%) and the South East at £11.4 billion (3.2%). Values range down to £2.2 billion in Northern Ireland (3.9%) and £2.3 billion in London (0.4%).
Source: ONS, Regional gross value added (balanced) by industry: all ITL regions, Table 1c; NISRA, NI Business Register and Employment Survey, Table 2.3; ONS, Business Register and Employment Survey, via Nomis

Estimates of the contribution of advanced manufacturing to regions and nations of the UK draw on the Industrial Strategy Sector Definitions List, which links each sector, where possible, to Standard Industrial Classification (SIC) codes.

The economic output estimate above also includes manufacture of petroleum products (SIC19), which is not part of the IS definition, as it is grouped with SIC 20 (manufacture of chemicals) in the data source. Therefore, the estimate is slightly broader than the IS definition.

Defence

The Library’s briefing on the contribution of the defence industry to UK regions and nations explains that the sector is estimated to contribute around £10 billion to £15 billion a year to the UK economy, with most activity concentrated in South East and South West England.

The tables below draw on estimates from the Aerospace, Defence and Space Group (ADS), the trade body for the defence sector. 

Two side-by-side tables showing 2024 defence industry economic output and direct jobs supported across UK regions and nations. Left table: Defence industry economic output (GVA) Lists regions with gross value added (GVA) in billions and each region’s share of total GVA. The South West has the highest GVA at £3.6 billion (1.9%). The South East follows at £3.5 billion (1.0%). Other regions range from £2.2 billion in the North West to £0.1 billion in Northern Ireland, with percentage shares between 0.9% and 0.1%. Right table: Direct jobs supported by the defence industry Shows the number of jobs supported and each region’s share of total jobs. The South West has the most jobs at 43,500 (1.7%), followed by the South East at 41,750 (1.0%). Other regions range from 26,500 in the North West to 900 in Northern Ireland, with shares between 0.7% and 0.1%.
Source: House of Commons Library correspondence with ADS; ADS, ADS Defence Sector UK Outlook 2025, page 9.

Commentary from Make UK

Make UK is the national body representing manufacturers.

In its 2025 regional manufacturing outlook, Make UK reports that that regional performance depends on how well its main manufacturing subsectors perform.

The South West recorded the strongest output and orders growth in 2025, which the report links to growth in its aerospace and defence industries.  (pp17–18). In the North East, output and orders have fallen from very high levels to roughly the UK average, mainly because the pharmaceuticals subsector has slowed (p11).

Make UK also notes that short-term performance does not always match investment plans. The South West reported strong activity but negative investment intentions (p17), while the North West showed moderate output growth but the strongest investment intentions in the UK (p13).

Common challenges across regions include skills shortages and higher business costs but Make UK welcomes the introduction of the Government’s new long-term Industrial Strategy (p4).

Further reading

Secondary information

Type
Research briefing
Reference
CDP-2025-0216 
Related items
Subjects
Defence Employment Economic growth National income Manufacturing industries
Contains statistics
Yes
Published by
Economic Policy and Statistics Section
House of Commons Library
Link
View this Research briefing on researchbriefings.parliament.uk