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Key 1998 UK 1998 2001 UK 2001
300
by Paul Warburton
North West
West Midlands
South West
East Midlands
South East
North East
West
Region/Country
(including telecommunications), aerospace and military equipment. It should be recognised too that many service (tertiary) companies are widely regarded as being of a high-tech nature, such as those conducting research and development or providing advanced design. Also, as the definition is largely product-based, it takes no account of the many (often low-technology product) industries that involve sophisticated technology in their production processes (eg as in parts of the food-processing industry). High-technology industries are also footloose industries. These are industries that do not have to locate close to raw materials or near markets, and which use electricity that is widely available as a source of energy. Footloose industries locate in pleasant environments near good transport
routes in order to reach a number of markets. Footloose industries often locate close to research centres like universities. They are also usually non-polluting and can locate close to residential areas.
Examples of high-technology industries include computer hardware and software, electrical/electronic engineering
Series 15 Spring issue Unit 300 High-technology Industry: an Update 2004 Nelson Thornes This page may be photocopied for use within the purchasing institution only.
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Northern Ireland
Scotland
2 To be in clean and attractive rural fringe locations. 3 Suburban locations are often accessible to airports. 4 To be near motorways for employees and customers. 5 Land values are lower on the edge of an urban area. 6 There is plenty of open space for expansion.
Sector
Lancashire No. %
North West No. 10,300 2,000 9,100 25,300 46,700 37,500 36,300 21,100 10,800 25,900 2,100 133,800 180,400
Great Britain No. % 60,200 50,800 125,600 110,400 347,000 173,800 351,900 169,500 131,800 216,400 23,100 1,066,600 1,413,500
Pharmaceuticals 1,300 Office machinery and computers 600 Electronics/communications 2,200 Aerospace 13,400 Total high-tech 17,600 Chemicals Non-electrical machinery Electrical machinery Scientific instruments Motor vehicles Other transport equipment Total medium-high-tech TOTAL high-tech 6,000 9,300 3,500 1,400 6,500 200 26,900 44,500
Science parks are usually located on the edge of cities in greenfield locations. Many of the firms located in science parks are connected with information, hightechnology and electronics industries. Science parks have direct links with universities for research. They have attractive layouts with grassy areas, ornamental gardens, lakes, etc. An example is the Cambridge Science Park. One feature of the distribution of high-technology firms for some time has been their concentration in particular areas, notably the South East and the high-tech corridor to the west of London. However, a more recent trend has been the increase in the number of companies locating in rural and semi-rural areas and peripheral parts of the UK. These locations sometimes reflect the choices made by founders of companies. Local people may be recruited and trained while skilled labour is brought in from outside an area.
to employment in manufacturing alone, the high-technology employee jobs comprised 14.1% of the countys manufacturing workforce compared with 9.1% in Great Britain. In these simple terms, the county is probably one of the most important centres of high-technology outside the south of England. As shown in Figure 2, the aboveaverage share of high-technology employment is due to the dominating presence of aerospace manufacture in the county. This industry accounts for 76% of local high-technology jobs (against 32% in Great Britain), or 30% of the high-tech and medium-high-tech jobs combined. In practice, the local importance of this particular sector in high-technology industry is certainly much greater than these statistics imply. Many smaller businesses support the major aerospace companies. They supply advanced engineering services, design and testing and information technologies not classified to aerospace but which are effectively a part of the sector. The other hightechnology industries have a relatively modest presence in Lancashire. Amongst the mediumhigh-technology sectors, aboveaverage local representation is to be found in motor vehicles, chemicals and non-electrical machinery.
Case Study
High-technology industry in Lancashire
In the year 2000 nearly 44,500 people, or 7.7% of Lancashires employee jobs, were within the high and medium-high-technology sector, compared with 5.6% in Great Britain and 6.4% in the North West region. The weighting towards Lancashire was even greater in terms of the high-tech component alone, with a local 3.1% share against 1.4% in Great Britain. Restricting the comparison
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Series 15 Spring issue Unit 300 High-technology Industry: an Update 2004 Nelson Thornes This page may be photocopied for use within the purchasing institution only.
Year 1984 1987 1989 1991 1993 1995 1996 1997 1998 1999 2000
High-tech 25,800 24,800 25,500 23,500 18,600 16,600 17,200 17,400 17,600 17,300 17,600
Medium-high-tech 40,300 38,900 40,400 33,600 29,000 31,900 30,900 30,800 30,200 30,300 26,900
Total high-tech 66,100 63,700 65,800 57,000 47,700 48,600 48,100 48,200 47,800 47,600 44,500
output to start growing again by 2003. Over the long term, many economists predict that there will be a shift into more high-tech manufacturing which is less labour intensive. This is because the UK will find it increasingly difficult to compete with other countries that can pay workers lower wages. Views are mixed on whether high levels of investment in technology have changed the structure of the UK economy. High levels of investment in information and communications technology have not yet been reflected in productivity figures but we know it takes time for the impact of technology to take effect: it is difficult to measure, and requires widespread consumer use to have full impact. Although US investment in computer hardware has been high since the 1970s, it was only when more users became adept at technology and when use of the internet grew and brought hundreds of millions of users online that productivity skyrocketed (Figure 4). The current crop of new technologies notably faster information processing combined with the internet have all the characteristics of the type of general-purpose technology which will in time reorganise the way the UK economy operates.
sectors has shown much greater stability and some sectors have generated new employment opportunities. The electronics sector, never a large one in Lancashire, has continued to shed jobs associated in some degree to restructuring in a handful of large plant operations, though recently this trend appears to have been reversed. Aerospace has enjoyed a steady jobs increase partly due to a major up-turn in both the military and civil aircraft markets. Although the industry has made large headline job loss announcements, it continues to recruit higher-order technical skills. Both pharmaceuticals (medicines and drugs) and computer equipment have also generated increased numbers of jobs, though this growth has taken place from a relatively small base. Amongst the medium-high-tech sectors the dominant trend during the late 1990s was one of employment stability, in sharp contrast to the heavy losses in jobs in the 1980s and early 1990s. Recently, though, the downward tendency has resumed, most notably in both the electrical and non-electrical machinery industries.
industries and to some extent car production. One of the largest manufacturing sectors is the production of food, beverages and tobacco. However, many of the traditional heavy industries in the UK, such as shipbuilding and metals, have seen their fortunes decline. Since January 2001, the overall manufacturing sector has been in recession, with output declining from month to month. Because of its importance in international trade, hightechnology has suffered more than most from the global economic slowdown. Its problems have also been made worse by the strong pound, which has made British exports that much more expensive than other international goods. Reduced investment and a generally poor image have also robbed manufacturing of the ability to modernise and attract new blood. In addition, cheaper labour costs abroad have persuaded some companies to move their production operations to Eastern Europe or Asia. The recent collapse of the telecom and technology sector further dragged down the performance of manufacturing industry because it has been argued that hightechnology industries have kept manufacturing afloat in recent years.
...the industry faces some significant challenges from market saturation. Gartner Dataquest analysts said the US PC market is nearly saturated, and Canada and Western Europe are not that far behind. Unless the industry is able to stimulate faster replacement cycles, shipment growth will undoubtedly slow in these markets. Given that these markets constitute 55% of the global PC market over the foreseeable future, that will put a significant damper on industry growth. Figure 4: Future of the PC market
Source: From the internet
Series 15 Spring issue Unit 300 High-technology Industry: an Update 2004 Nelson Thornes This page may be photocopied for use within the purchasing institution only.
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Activities
1 Study Figure 1. Describe the distribution of employment in high-technology industry in 2001 in the UK. 2 (a) What is a science park? (b) Use the following website to carry out some research on the Cambridge Science Park: www.cambridgesciencepark.co.uk/ home.htm Write an account using the following as subheadings: History Typical companies on the science park Location Facilities Layout of the science park. 3 (a) Use a copy of Figure 6 to complete a compound line graph based on the high-technology and medium-high-technology data for Lancashire in Figure 3. (b) Shade in two colours the hightechnology and medium-hightechnology sections of your graph. (c) Using your completed compound line graph, outline how and why employment in high and medium-high-technology industry in Lancashire changed between 1984 and 2000. 4 This activity can either be done with a calculator or using a spreadsheet. (a) Make a copy of Figure 2, then calculate and fill in the percentages for Lancashire, the North West and Great Britain. (b) Complete the Totals row at the bottom of the table. NB If you use a spreadsheet, (a) and (b) should be entered as formulas and the software should calculate these for you. Print out for your teacher two versions of the spreadsheet. One should show all the data with the complete column titles. The other should show the formulas. When you print out your two spreadsheets, make sure that you print them with column and row headers and grid lines this is good ICT practice! (c) Which type of manufacturing
100,000 90,000 80,000 70,000 Total high-technology Numbers employed 60,000 50,000 Medium high-technology 40,000 30,000 High-technology 20,000 10,000 1984 1987 1989 1991 1993 1995 1996 1997 1998 1999 2000 0
Year
industry accounts for: (i) the highest percentage of hightechnology jobs in Great Britain? (ii) the top two highest percentages of medium-high-technology jobs in Great Britain? (d) Which type of manufacturing industry accounts for the highest percentage of high-technology jobs in Lancashire? 5 What does Figure 4 suggest will influence the growth rates of parts of high-technology industry in the near future?
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Series 15 Spring issue Unit 300 High-technology Industry: an Update 2004 Nelson Thornes This page may be photocopied for use within the purchasing institution only.