Executive summary

Sheffield’s Advanced Manufacturing Park (AMP), which contains the core of the University of Sheffield Advanced Manufacturing Research Centre (AMRC), is helping transform Sheffield City Region’s economy from a place for low-cost production to a place for high-value knowledge production.

The AMRC is a research institution based on the AMP that links researchers and academics with firms in the advanced manufacturing sector around the UK and the rest of the world. Large multinationals such as Boeing, BAE Systems, McLaren, and smaller supply chain firms have operations on the site or tap into the research that takes place there.

This report explores the impact of policies on the AMP and the way they increase highly-productive and skilled manufacturing activity in the local economy of Sheffield City Region. It also sets out lessons for other cities and policymakers. Its main findings are:

The AMP has a concentration of highly-productive exporting work. The AMP accounts for 499 advanced manufacturing jobs. Although its contribution of jobs to Sheffield City Region is modest, these jobs are more productive than manufacturing in the rest of the Sheffield City Region and show how the park has been able to attract higher-skilled activities.

The AMP is attractive to advanced manufacturing firms because it is a hub of knowledge and applied research expertise. Access to engineering graduates and postgraduates from the University of Sheffield, its open-source research model that shares discoveries across the AMRC’s network without patents, and face-to-face interactions with other skilled firms and researchers working on the AMP are critical to the AMRC’s success. This creates links with production centres across the country and around the world and makes the AMP nationally significant.

The AMP highlights the importance of place as the integrator of the other four pillars of the Government’s Industrial Strategy. The AMP is a concentration of knowledge-intensive exporting activity. It is a location where research is created by high-skilled individuals and firms, which is then applied to production processes elsewhere. By bringing together this activity in a place, it supports people and ideas in Sheffield City Region and increases the productivity of economic activity elsewhere.

The AMP and AMRC provide important lessons for the Government and for other places developing advanced industrial parks of their own:

Access to knowledge drives economic differences across places. As a whole, the Sheffield City Region underperforms in its provision of skills. Accordingly, less-skilled and lower-paid work characterises the city region’s economy, while work that requires many skilled workers locates elsewhere. However, due to the matching of skilled workers from the University of Sheffield with firms on the AMP and the research that takes place on the site, the AMP is able to appeal to new and higher-paid activity.

Activities in one place often have benefits in other places. The AMP’s role as a place of innovation and high-skilled activity means that some of the direct economic benefits of the AMP, such as new machining techniques, are realised in other parts of the country where low-cost manufacturing takes place. The relevance of the AMP to National Industrial Strategy is, therefore, how it improves the performance of firms across the country, and not just in Sheffield City Region.

The open-source approach to research has enabled the AMRC’s success. Advanced manufacturing sites already in development, such as in Sunderland, Tees Valley, and Glasgow, that are looking to repeat the success of the AMP will need to share its key advantages. This includes not just access to skilled workers, but links with a university, the open-source innovation model without patents, and a network of firms with activity outside the new site that can benefit from research that takes place there.