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Action needed – Private sector

Clusters:

  • Clusters are ‘geographically proximate groups of interconnected companies, suppliers, service providers and associated institutions in a particular field’ – they need a sizeable local population, nearby universities and research establishments, some suppliers and customers already there, and cheap and fast transport

  • Clusters enable cities to be more productive than towns, and mega-cities more than cities – they offer major synergy benefits viz:

  • A pool of right skilled labour – ‘talent attracts talent’

  • A cross-fertilisation of ideas and technology for more innovation

  • Availability of, and competition between, specialised local suppliers who offer other members a quick service and less need for stock

                

Current UK clusters

·    London                               Financial, business & legal services

                                                 Media and creative industries

·    Thames Valley                    IT

·    East Anglia, Cambridge      IT, Biotechnology, Genomes, Telecomms

·    Midlands                             Automotives

·    Yorkshire, Humber            Metals

·    North – East & West          Automotives, Chemicals,            Defence, Medicines

·    Scotland                            Call centres, Engineering, Shipbuilding

  • John Rose, CEO of Rolls Royce, asked: “Why does the UK not have something like France’s world competitive cluster in Toulouse – it’s a great example of industry, academia and government working together to create world-class products – it supports 94,000 well-paid, highly skilled jobs in 1,200 companies and has a turnover of 10 billion euros”

  • The USA has benefitted from many such clusters too viz:

    • Silicon Valley Stanford University set aside land for their graduates to set up their own businesses:

      • William Hewlett took advantage and Hewlett Packard now employs some 80,000 people

      • ditto David Filo and Jerry Yang with Yahoo

      • ditto Larry Page and Sergey Brin with Google

    • The Boston life-sciences cluster

 

  • Government ministers should offer powerful incentives for new clusters to be developed in more regions, especially if the need is to rebalance the economy

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