Assembling a bearing, British Timken Works, Daventry, Northamptonshire 1957. Photograph by Maurice Broomfield, courtasy HOST Gallery.

The BBC has some beautiful pictures by Maurice Broomfield of factories across the UK in the 1950s. They are definitely worth a look.

But worringly - and in keeping with how the BBC portrays manufacturing - the piece leads off suggesting the 1950s and 60s was "an age in which Britain's industry was at its zenith".

Well, the sector is now bigger, leaner and more innovative as well as greener, safer and more efficient than it was in the 1950s and 60s. Yet the BBC insists on showing clips of industry rooted in dated myths of dirrt and decline.

Maybe the BBC should commission another set - or better yet, hold a photographic competition to celebrate British industry, rather than constantly relying on stock footage.

EEF's 'Manufacturing Week' is making waves in the US.

At their request, I've been talking about Manufacturing Week on the manufacturing social network MfGCrunch. Here's an exerpt from my post:

"With an election looming and our economy crawling out of recession, the simple objective of 'Manufacturing Week' is to put manufacturing at the heart of the debate on the future of the UK economy.

In the UK, the manufacturing sector is plagued by persistent myths - that manufacturing is in decline, that we don't make anything anymore, that industry is dirty and dangerous, that successful kids go to college while the slow ones work in manufacturing, and - even more dangerous - that we can keep the clever stuff in the UK and send the production abroad.

These myths are rooted in dated images of industry and sit awkwardly with the widely accepted need to 'rebalance' the economy by growing manufacturing.

But what to do about it?

Well, the answer was simple - start standing up and shouting about what makes modern manufacturing so great - and so competitive - in the UK.

See, for the past 20 years, we've had bankers and lawyers pushing politicians to support a 'post-industrialist' society. They got what they wanted because they made politicians take notice.

But instead of griping about the recession they caused, we decided to take a page from the bankers' playbook and start 're-educating' the public and our politicians about modern manufacturing and why the sector is so important to the future of our economy.

As part of this campaign, we launched 'Manufacturing Week' to allow UK manufacturers to stand up for themselves, to be heard and to get in politicians' ears.

We've had special reports in the Telegraph, the Financial Times and The Times - all showing modern manufacturing as the diverse and dynamic industry it is.

And manufacturers are hosting events all around the country and blogging on why manufacturing matters.

Sure, it's been a struggle. UK manufacturers are modest by nature - they just like to get on with being a successful business.

But get them going and their passion is contagious."

It's a good start to the UK's first Manufacturing Week.

First EEF's Manufacturing Outlook shows that Britain’s manufacturers are looking to the future with greater confidence about the prospects for recovery: orders are returning and companies are consequently the most upbeat since the financial crisis began in mid-2007.

And then today's PMI's showed sustained strength, and the best export-orders since July 1996! More importantly, the Eurozone PMIs showed renewed strength in German and French manufacturing...again, more good news for exporters.

But we have to be cautious about predicting a strong rebound, as a number of factors could knock growth off track.

The recovery depends on world markets continuing to grow, and the financial system’s ability to provide finance is yet to be fully tested. And investment plans are also likely to remain on hold until manufacturers get a better sense of how a new government plans to repair the public finances.

With all the talk of rebalancing, Robert Allen at Oxford University takes a look back into history and asks why the first industrial revolution took place in 18th century Britain and not elsewhere.

His answer? Britain was a high wage, cheap energy economy that encouraged investment in technolgoy rather than labour:

"It is still not clear among economic historians why the Industrial Revolution actually took place in 18th century Britain...Answers to this question have ranged from religion and culture to politics and constitutions....[But in reality] the British Empire’s success in international trade that created Britain’s high wage, cheap energy economy, and it was the spring board for the Industrial Revolution

The technologies of the Industrial Revolution were only profitable to adopt in Britain, that was also the only country where it paid to invent them. The ideas embodied in the breakthrough technologies were simple; the difficult problem was the engineering challenge of making them work. Responding to that challenged required research and development, which emerged as an important business practice in the eighteenth century. It was accompanied by the appearance of venture capitalists to finance the R&D and a reliance on patents to recoup the benefits of successful development. The Industrial Revolution was invented in Britain in the eighteenth century because that was where it paid to invent it."

So now that we're in a high wage, expensive energy economy will we really see another industrial revolution?

Yes, but as Allen suggests, only if it pays to invest in technology and develop innovations in the UK.

The £1.5 trillion question is does it pay to be a manufacturer in the UK as opposed to any other country in the world?

Probably, but not nearly as much as it used to. And that's the challenge facing our economy today.

2009 was a painful year for most manufacturers, but it looks like the sector ended the year on a strong note.

Today's Index of Production figures for December suggest that manufacturing grew by 0.8% between q3 and q4 last year.

Although that strong growth reflects a weak summer - there were plenty of shutdowns in August - the growth in the Autumn was broad-based. And that's (hopefully) a sure sign that there's decent amount of momentum behind the recovery.

Will q1 2010 be just as strong? I'm beginning to change my mind. Activity could fall off because of the wintery start to the year, but we're starting to hear more positive stories from manufacturers about their prospects.

Many companies I've spoken with over the past 6 months said that spring 2010 was always their target date for recovery - the question was what happened in between now and then. The encouraging news is that spring is getting closer and the potential pitfalls - exchange rate volatility, slower global growth and withdrawal of stimulus - are falling by the wayside.

Two big concerns remain: China and the public finances.

Can China avoid a wage-price inflationary bubble without derailing its economy? Can the (next) UK government credibly repair the public finances?

Those are the two big questions remaining for 2010.

A few month ago, I spoke at a North West RDA's launch of its Manufacturing Strategy. My talk was on innovation in manufacturing, but during the panel debate afterwards, I got a fairly pointed question:

"Do the politicians get it?"

The answer I gave was a resounding 'No'. Beyond Lord Mandelson, there's little understanding of what makes modern manufacturing successful.

The audience grumbled, so I pressed them: Why, did they think, did finanical services get a light-touch regulation over the past 20-plus years? Because they stood up and asked for one. They argued fairly persuasively that the UK needed to move to a 'post-industrial' economy, and the politicians gave them what they wanted.

While the devastating depth of the recession has proved the City wrong and got people talking about manufacturing again, where are the manufacturers standing up, demanding to be at the heart of a healthy economy?

At EEF, we're doing our bit - our Manufacturing. Our Future. report was the first step in a campaign to shout about what manufacturers need to be successful.

But as an election draws closer, it's time for manufacturers themselves to stand up and get engaged.

That's why we've started our 'We ♥ Manufacturing' campaign. It's not really driven by EEF, but by manufacturers talking about why manufacturing matters. The audiance is prospective MPs and the public. If you support manufacturing, then tell us why. 

How else are the politicians going to 'get it'?

Another day, another set of data suggesting that UK manufacturing is starting to shake off the worst of the recession.

And that's good news because without exports, there's little else in the economy that's going to give the wider recovery the spark it needs.

This morning, the CIPS/Markit UK Manufacturing Purchasing Managers' Index put manufacturing activity at 56.7 - a 15 year high. Anything above 50 on the index indicates growth, the higher the number, the stronger the growth.

The survey showed that growth was fairly broad based. New orders were the strongest in six years because of both domestic and export demand.

And even the employment index managed to squeak above 50.

The one (small) red-flag in the report was on the cost side. The strong global manufacturing recovery - especially in China, which posted a record PMI for January - and the weak sterling are pushing up costs of imported raw materials. that means manufacturers are likely to keep one eye on inflation and continued cost control.

EEF have long said that tax reform needs to be central to rebalancing our economy.

But because of silly Whitehall turf wars, the good work coming from BIS on industrial activism and a manufacturing strategy has often existed apart from the realities of the tax system.

For example, the Strategic Investment Fund of £950m is being put to use to encourage investment in growing markets and supply chains.

But the capital allowance regime actively discourages manufacturing investment.

How? 

Manufacturers replace their equipment, on average, ever 7-8 years. With a capital allowance level of 20%, the tax system only recognises that investment over 28 years. That gap raises the cost of investing in modern machinery in the UK. Looking across the tax system, you get similar disincentives to invest in manufacturing.

But at a speech on Monday night at a Progress event, Pat Macfadden, the BIS Minister linked the two issues of tax and industrial activism.

It was a first for the government and an extremely welcome recognition that building a balanced economy requires strategy that is implemented across government, not just by a forward-looking BIS department.

Today’s data confirm that manufacturing is now out of recession.  But they also continue to raise questions over the health of the wider economy.

Previously, we've said that weaker growth in Q4 would be a good thing, because a strong q4 would most likely have come at the expense of a weak start to 2010.

But at 0.1% q-q, GDP growth was very weak in q4. Not even a strong boost from manufacturing of 0.4% q-q could boost growth in the wider economy. 

So while exports remain the best prospect for a turnaround, the next six months will be uncertain one for the recovery.

Read our reaction on the BBC website.

Back in December, the head of construction company told me the following:

"No one has got to grips with what's just happened to us. Which means the don't really understand what it takes to get us out of this. And that leaves us drifting."

His comment got to the heart of the matter - do we really know where we are , why we've gotten here and where we want to go as an economy?

A couple of recent reports on the state of government in the UK suggests why we haven't come to grips with our problems:

"a conspicuous lack of a single coherent strategy for government as a whole...inhibits the ability to set overall government priorities and translate them into action."

Another report by Whitehall Manderins comes to similar conclusions and makes the following recommendations:

• improve the quality of legislation by slowing down the legislative process and improving scrutiny;
• strengthening Commons Selet Committees; and
• stopping the frequent shifting of Ministers.

Although these criticisms are slightly sensational as they come just months before an election, they are all too familiar to businesses at the sharp end of frequent changes to the tax and skills systems, for example.

EEF raised these issues last year - first in our report on the competitiveness of the tax system, and then again in Manufacturing. Our Future. report which set out a government-wide strategy to rebuild our economy.

So what's the key challenge for the next parliament given these criticisms about the state of government?

Thinking and acting differently, because we can't afford to drift any longer.