Engineers work across most of the major sectors of the economy, emphasising the importance of the sector to the economy. The manufacturing sector employs most registered engineers, accounting for 40% of employment in 2003. Figures show that around 60% of the UK’s exports of goods and services are of manufactured goods that are reliant on engineering skills. 

The majority of engineering establishments in Britain are very small, employing fewer than 50 people.  Only 7% of firms are medium business (employing 50-249 people). Whilst, approximately 1% of establishments employ more than 250 people, these account for around 37% of total employment in the sector.

Source: ETB 2005 and SEMTA 2003

For more information on land-based engineering go to the agriculture section.

For more in-depth information on the engineering sub-sectors see:

Total employment in the engineering sector is around 1.4 million. This is 20% lower than 5 years ago which reflects the continuing decline in UK manufacturing employment. It is estimated that more than one third of a million workers have been lost from this sector since 1999. Total employment is expected to decline further over the next 10 years, but at a slower rate than that of the last 5 years. 150,000 jobs are expected to be lost over the next 10 years, half of which will be amongst the Skilled trades occupations.

While the net requirement for people will be lower, when you take retirements into account there is still substantial requirment need.  This is true for all occupational groups with the exception of Elementary occupations (including Skilled trades occupations, and Machine and transport operatives). A net loss in elementary occupations is expected over the next 10 years which just outweighs the replacement demand requirement.

90% of the workforce is full-time. Part-time employment and self-employment are both extremely uncommon in the sector.

Employment in this sector is predominantly male (80%) with less than 1-in-5 female workers. 

Skilled trades occupations, Machine and transport operatives, together with Elementary occupations account for 56% of employment. This is almost double their average share in the UK economy as a whole.

Source: Working Futures 2006 and SEMTA 2006

For employment figures in the engineering industries go to automotive, electronics and aerospace.

Find more information on hard-to-fill vacancies and skills shortages here:

Source: Working Futures 2006, figure 3.6.2. Based on CEI/ER estimates.

The science, engineering and technology industry plays a major part in the UK economy, representing over 10% of total UK GDP. It accounts for more than one third of total UK exports. It is estimated that, in the UK, there are some 1.8 million people employed in about 75,000 establishments in the core science, engineering and technology sectors. Employment in these industries is expected to grow over the next decade.

Future trends in theses industries will focus on pressures to reduce costs and improve quality. Technological developments will continue to result in changes in working practices and in the structure of companies.

Source: SEMTA 2006

Keywords

GDP - Gross Domestic Product is a measure of the value of goods and services produced, before allowing for depreciation or capital consumption.

In 2004, the estimated total employment in engineering was approximately 1.4 million, which is expected to fall to approximately 1.3 million by 2014. It is also projected that the industry will require substantial replacement demand over the next decade, with 230 thousand additional jobs. Trends in employment have been influenced by:

• changes in technology
• increased quality requirements
• the need to reduce costs
• changes in working practices (such as team and cell working)
• the move to batch production rather than mass production particularly in the automotive and electronics industries

Although employment in engineering has been in decline in the UK for several decades and despite falling internal competitiveness and some companies scaling back their UK operations and moving abroad, 2004 saw growth in the sector. Employment of professional engineers and higher level technicians has been steadily increasing while employment in craft and operator/assembler occupations has decreased.

In 2003, an estimated 2.5 million workers in the UK used some engineering skills in their day-to-day work. A noticeable trend in employment has been a shift in the occupational balance towards higher level skills and education requirements and this is expected to continue in the future.

Future recruitment difficulties have and will continue to impact on businesses resulting in:

• increased staff workloads
• difficulties in meeting customer service objectives
• loss of orders
• increased operating costs 

Skills gaps are most likely to affect operating costs or create difficulties in meeting customer service objectives reducing the productivity and competitiveness of establishments.

Source: Working Futures 2006, SEMTA 2006, Spilsbury Research/SEMTA 2004 and SEMTA 2003

For future replacement demands in engineering see Occupations

Overall future drivers of productivity for the sector include:

• Small supply chains firms need to meet quality and skills requirements of larger firms
• Companies are actively considering moving investment abroad due to lower labour costs.
• Lean manufacturing and increased automation of technology has allowed UK automotive manufacturers substantial productivity gains to compete with overseas manufacturers.
• Lean production features the continuous elimination of buffer stocks and indirect workers, the development of work teams capable of rotating jobs, the synchronisation of production to reduce bottlenecks and a built in quality check.
• Investment, innovation and lean manufacturing will all impact on the skills required for major productivity gains.
• A significant up-skilling of their workforce is needed to keep up with France, Germany, Japan and the USA.
• The quality of school leavers does not meet the sector’s requirements and careers advice is inadequate.
  

For specific industries:

Electronics

• Raising venture capital is a barrier to business development and management effectiveness, particularly for SMEs.
• Manufacturing has moved abroad to take advantage of lower labour costs
• Shorter product life cycles and design cycles require companies to constantly
• innovate and change products and production methods, requiring a greater breadth of skills.
• Reliance on foreign-owned firms to carry out innovation.

Automotive

• An increased requirement for investment in joint venture work on design and standardisation of common platforms as well as investment in IT-intensive real-time supply chain management.
• Increasingly important to meet customer demand for new models with greater styling, quality, performance and reliability.

Aerospace

• Levels of regulation limit investment.
• Use of modern management practices would increase profitability and therefore investment.
• Improved skills and innovation are needed to boost investment.
• Skills availability has a negative impact on productivity.
• The image of the sector has a negative impact on recruiting the right people.
• The funding of Modern Apprenticeships restricts up-skilling in the sector.
• There is a need to increase the number of science and engineering graduates and the opportunities to gain the required work experience.
• The industry is pursuing Process Excellence implementation to increase productivity and maintain the position of UK aerospace within the global supply chain.
  

Future developments in the automotive, aerospace, ship and boat building/repair, and electronics sectors include outsourcing and devolution of responsibilities down the supply chain.

The sector’s priorities for action include:

• attracting more people into the industry
• developing appropriate qualifications and learning programmes
• up-skilling the current workforce 

Source: SEMTA 2006

Further future trends are noted in the engineering industries information see: automotive, electronics and aerospace.