Deindustrialisation

Why are some products no longer manufactured in the UK?

The manufacturing industry has declined in importance in some regions, while it has become more significant in others. Areas like the EU have seen a decline in manufacturing, but countries like China and other developing nations have been increasing. 

In 1981 there were 6 million people employed in manufacturing in the UK. This fell to just 2.49 million in 2010. 

This occurred as a result of deindustrialisation in the UK: 

A process of decline in some types of industry over a long period of time results in fewer people being employed in this sector and falling production. 

Reasons for growth in areas such as Tunisia and China: 

Government Legislation

• Growth has been encouraged by enterprise zones - areas where conditions are favourable for new industry, attracting companies. E.g lower taxes
• Buildings for production are built in the hope they will encourage businesses to buy/rent them. 
• High educational standards have been encouraged to ensure a skilled and educated workforce to attract investment.

Reasons for decline in areas like the UK:

• A minimum wage has been introduced which has encouraged TNC's to locate factories elsewhere where costs of labour are lower. For example, the minimum wage in the UK is £6.08 per hour for those aged 21+. However, in Tunisia the minimum wage is 47p.
• A maximum number of working hours has been introduced - although the UK has separate agreements with the EU, we have a tradition of working around 37.5 hours per week. In the UK, the average hours worked in a year is 1,652 but in Tunisia the average is 2,100. 

Health and Safety regulations

These vary considerably. The more regulations in place, the more likely an organisation will locate elsewhere as regulations tend to increase the cost of production. 

Rights for workers in the UK:

• Know how to do their job safely and be trained to do it.
• Know how to get first aid
• Know what to do in an emergency
• Be supplied with protective clothing

However, health and safety regulations do not exist in some poorer countries. This has encouraged growth of industry in these countries. 

Benin

In Benin, farmers use insecticides and fertilisers to help their crops grow on degraded soils. However, there are little to no health and safety regulations and people are dying as a result. During last year's cotton season in Benin around 100 people died after using the pesticide endosulfin. Despite the chemical being banned in some wealthier countries, TNC's like Itadenim are still forcing cotton farmers in Benin to use the toxic pesticide endosulfin.

Prohibition of strikes

Countries that have regular strikes are likely to put off businesses as this will slow down production. In countries like Tunisia, where 900 at the Lee Cooper are members of a union, there is a Trade Union but the TNC's often have more power than them. They can simply employ another worker if they threaten to strike. 

A strike is a period of time when large numbers of employees refuse to work due to disagreements over pay or other grievances. 

Tax Incentives and Tax free zones

The government often offers grants to businesses to encourage them to locate factories in particular areas (E.g the north east of England). Countries like Dubai even offer tax free incentives to new businesses. 

What have the UK government done to try and persuade businesses to located here?

The government have tried to perused businesses to locate by providing tax incentives which seek to offset costs. For example 'One Northeast' (the development agency responsible for the north east of England) offered job creation grants, business rate or rent free periods to help in preparing a business plan.