Web fads and video games
represent many billions of pounds in potential earnings.
Inventor Sir James Dyson has criticised the UK government for putting "web fads and video gaming" ahead of more "tangible technology" that Britain can export. In an interview with the Radio Times magazine, the creator of the bagless vacuum cleaner said ministers needed to address a serious lack of engineering graduates in the …
represent many billions of pounds in potential earnings.
We don't know the context in which Dyson said "Web fads and video games".
Video games do generate millions, though I'd associated the bigger players in the HD console age to be based up North (Rockstar, the late Studio Liverpool). I know a lecturer in Further Education whose college (not a million miles away from Malmsbury) has around a hundred places for video game development and they only expect a few percent to get a job in it- but hey, at least they don't show as unemployment statistics.
Round here, we have Dyson, Renishaws, Rolls Royce, Airbus and associated suppliers. Hewlett Packard Labs Bristol, too, though I've never been able to work out what they do (some were messing around with Stratasys machines, some measuring the angular momentum of gas molecules with lasers).
Stuff and nonsense, well at least as far as the 'web fads' is concerned. These do not generate any socially useful earnings, if anything they displace earnings from elsewhere. They operate in some ax avoidance crevice between jurisdictions, and are mostly profiting from the creative endeavours of others.
The companies behind them are more akin to flesh eating bacteria. Which come to think about it should be quite attractive to Tories.
With you until the specious Tory remark.
What does "socially useful earnings" even mean?
The "Digital, Creative & Information Services" sector generated 4.5% of GVA in 2012 and accounted for 3.7% of employment. That makes it roughly three times larger than the medium/high tech equipment manufacturing sector that Dyson would fall under if he didn't manufacture abroad, and fifteen times larger than the R&D sector that his UK-based business actually falls under. It is also growing considerably faster.
You can scoff at whether the Twitter Angry Birdbook sector provides any real benefit to mankind, but the figures suggest that it is an important part of the UK economy and something that any sensible government ought to be promoting.
"I'd associated the bigger players in the HD console age to be based up North (Rockstar, the late Studio Liverpool)"
My friends from Studio Liverpool will be impressed that you considered them a "big player", but Wipeout is hardly in the same league as GTA IV (think 100 times less revenue). Sure, there's a NW games industry, and Evolution in Runcorn deserve a mention, but it hardly outshines the rest of the country. Just on PS3 exclusive there's Media Molecule in Guildford, and Sony's London studio (far larger than Liverpool). Then there's Lionhead, also in Guildford. There's Braben's lot in Cambridge, there's still a large contingent around Leamington Spa, and I think Sega Racing is still going, just outside Birmingham. On middleware we have Geomerics in Cambridge and Havok - well we can't take credit for them since they're in Ireland. But I think RockStar North probably dwarfs the rest of the UK console games industry combined.
But ultimately employ very few people. If you're not making physical products then you're not employing many people. ARM employs 2,368 people, Intel employs 100,000.
Generate millions of revenue, what about profit?
Like other creative industries they hate paying tax and have asked for tax breaks. That's not really contributing is it?
Well said. It's generally frustrating to read the sorts of comments attributed here to Dyson when they come from people whose manufacturing work happens elsewhere.
What he seems to be doing is throwing a strop that his company isn't being given special treatment as The Template For Britain's Future. And, well, I suspect part of that is because he's shown that he's willing to move production elsewhere to save money - not the wisest template for UK.gov to follow for trying to grow the economy.
It means it is highly skilled work and therefore no good to reduce the general unemployment rate. You can't take someone who used to work as a machine tool maker and retrain them to code games.
"The "Digital, Creative & Information Services" sector generated 4.5% of GVA in 2012 "
But of that, I doubt that more than 0.1% was games and frippery. Most of it will have been bog standard IT work - Northgate IS, HP's UK services, Crapita, etc.
And the problem is that our shallow, inept government are pushing that (guessed) 0.1%, not even the remaining 4.4%. There's a governmental obsession with pushing "higher value" jobs, which invariably ignores the need for a balanced economy. The millions of people currently unemployed, generally speaking, aren't looking for jobs in Shoreditch as top games designers, or technical architecture directors. Instead, they want mid market white or blue collar jobs, or they are after basic clerical or manual roles, and other than the job creation scheme of the Civil Service and local government, there's nothing done for these people.
"Round here, we have Dyson, Renishaws, Rolls Royce, Airbus and associated suppliers." Rolls Royce is round here as well; their sites were deliberately scattered around the country so the Nazis couldn't blow up all their aero engine manufacturing capacity in one swoop. Barnoldswick and Derby are the only ones I can remember off the top of my head and there'll be other sites that've closed down since WW2.
You might want to give Dyson some credit, that he did try to make them in the UK, but the costs were too high. Sadly government would rather p*ss £50m on a scabby bit of east London, rather than fix the bits they can (like their 14% tax on employment, or the broken property market that inflates wage).
Ta, that was a nice little outline.
I guess that SL's (Psygnosis) WipEout punched a bigger dent in my conciousness than its weight would merit... I remember it marking the transition from video games having cute characters for kids to being something people played after a night on the disco-biscuits (and marketed as such, with music from FSOL and The Prodigy and interface design from The Designer's Republic, who did designs for Warp Records.
I tried playing WipEout HD the other day on a mate's PS3, and obviously time has not been kind to my reflexes: It was frustrating and stressful (my fault, not the game's!) Fortunately, there was a game on its HD called 'Flower' where you play the part of a flower petal, softly drifting in the breeze bringing colour to gentle valleys. I think every console should have this game built-in, as an antidote to war games.
Dyson, like many in the engineering field, straddle both the manufacturing and IP sectors. The fact remains that physical products are not only manufactured, but they are also designed, and the tooling to manufacture the parts is also designed. People may decry the loss of UK manufacturing, but last year we had record sales of design and manufacturing software into UK engineering.
Numatic in Chard ar able to nail together a perfectly functioning, reliable vacuum cleaner for £100 retail.
Your saying that Dyson vacs, which are premium priced at £200+, can't make UK production pay?
I'd never have a Dyson anyway. If I'm spending £200+ on a vac cleaner, I expect it to be absolutely trouble free for 5+ years. The Dyson my folks bought spent more time being fixed than being used.
We had a big Dyson fan in the office to replace a tower fan in the corner. Went back after one day. They work, but to get any sensible airflow you have to wind them up, at which point the tiny fan in the base takes on the acoustic characteristics of a small jet engine. We got another generic, conventional fan for 25% the price of the dyson which was capable scattering papers across the office with narry a whisper.
The desktop versions might work better, but all in all a nice idea badly implemented, just like most of his other ideas.
See ... now I want a job title with "frippery" in it. Do I have to move to Shoreditch?
You're very probably right. The paper I was looking at doesn't have the breakdown but the total was ~£60 billion and "frippery" can only be a small fraction of that. I made another post somewhere else about the dubious reasons that they were concentrating specifically on Silicon Roundabout and pretty meedja tech.
> he's willing to move production elsewhere to save money - not the wisest template for UK.gov to follow for trying to grow the economy.
It's exactly the wisest template.
R&D and engineering here, cheap ,mass production in SE Asia.
ARM doesn't manufacture anything but that doesn't mean it's better to fund some screwdriver plant that puts made in UK badges on TVs until the subsidy runs out.
By "socially useful", he means "projects that further the proletarian revolution". At least I assume so, because the rest of his post sounded like an episode of Citizen Smith.
My introduction to The Designer's Republic was the cover of Pop Will Eat Itself's "This Is The Day..." album, so when I saw that they also did some work on Wipeout I had to get it.
Why not exactly?
Malcolm Evans went from being an electronics engineer to a games programmer, and I'm sure another programmer from the 80's went from working as a TV repair man to making games (was it Jon Ritman?).
Just because someone works as a tool maker doesn't mean they can't re-train. Of course they might not want to.
One bad Dyson does not mean all of them are bad.
We've had the DC02 for 15 years! It does the same job as when it was brought in the 20th century, and although some of the springs (cable rewind seems to be a common issue - other working DC02s I've seen suffered the same issue) and cover latches are a little loose, it still works. For a first generation mass-produced product (not counting the Japanese version), it's a good demonstration of British engineering.
Not to discount the Numatics - the Henry we had for industrial use just works solidly day after day - and the outward design hasn't changed in decades, though I'm sure the internals have had steady improvements over the years.
@Yet Another Anonymous coward
The problem with what you're suggesting is that it's very far from being even remotely sustainable.
In the UK, the higher education sector is trying very hard to ensure that foreign students continue to come here to study - students want to come here for the quality (or at least perception thereof) of education offered, the universities want them because non-EU students pay exorbitant rates compared to everyone else (between £16K and £35K depending on circumstances, which is exorbitant here but kind of unsurprising in the US). Unless there are more design/R&D jobs in the UK than can be filled by UK graduates in the relevant disciplines, this means that the UK higher education sector is a net exporter of graduates in those disciplines.
Over time, this means that the R&D/design work gets farmed out to people outside the UK as well because if your work has no physical aspect to it, you can work remotely with nary a problem - and that means they can hire someone from whatever country has the lowest costs at the time with no difficulty.
Compared to moving physical production and fabbing work, moving "knowledge work" is trivial. So tethering your entire government approach to economic development to non-physical-product creative industries who will see a clear economic incentive to move elsewhere as soon as they get a chance is not, IMO, a long-term approach.
The counter-argument is that it doesn't need to be a long term approach as long as it can help foment growth for a while, at which point I suppose we'd need hard facts and numbers before we could draw any conclusions.
We had a first gen DC02 which was woefully unreliable when you take its cost in to account. Cable return, power switch and many other parts failed on it, while my old man struggled to keep it going, not to mention the noise which was akin to a jet aircraft at takeoff.
When that finished we got a Numatic, which simply worked, even after my mother managed to set fire to it (cleaning around a wood burner and a hot ember lodged in the filter, lots of smoke but was fine after). In the end the motor bearings got noisy and my mum bought a "Hoover"...
Only it was a PRC made "fake cyclone" POS which had less power than an asthmatic snail. In the end a new autosave Henry (with switchable 600/1200W modes) replaced it and it's great. And you can buy every part (down to motor brushes) online.
I think Dyson is just spinning like mad in an effort to suck up more funding
They need more funding otherwise what will happen to all the self facilitating media nodes?
"British knowledge is simply taken abroad."
Dyson products are made where, exactly? Clue: it's not in the UK.
True up to a point. That Dysons are made abroad does not stop Silicon Roundabout being bullshit.
>Dyson products are made where, exactly? Clue: it's not in the UK.
No, but after they moved production to Malaysia, they employed more people than they had in the UK, only in higher-paying R&D jobs. Clue: Dyson can't get his hands on enough engineers.
there needs to be a distinction between designed, manufacture and assembled. As Dave 126 says, the (very) low paid grunt work got off-shored but the high(er) paid design work, etc. stayed in the UK and grew.
Also, FWIW, Dyson does put his money where his mouth is, when talking about the UK. According to this indie article (http://www.independent.co.uk/news/uk/home-news/the-billionaires-who-do-pay-their-bills-including-james-dyson-and-jk-rowling-7873607.html) he makes no effort to be "tax efficient" and in 2006 at least, was responsible for paying more than half of the tax revenue contributed by the 54 billionaires in the UK at that time. Similarly his company pays most of it's tax in the UK too.
Thank you, I didn't know he was paying a "moral" tax level. I assumed, like all other large companies notionally based in the UK, he was engaging in tax efficiency.
We don't fabricate stuff here that much any more. Mostly what we do is design stuff, and design the tooling (dies, moulds, patterns) to make the stuff. Our economy has moved more into IP in its wider contexts and those so employed earn 60% more on average than those outside of the IP sectors. However that won't last forever and the emerging economies will soon become self sufficient in designers and engineers. India produces over 20 million graduates a year and they aren't going to be settling for call centre jobs for long. In fact from our sales of design and manufacture software into places like India and China it won't be long before a lot of that work is done there as well.
>emerging economies will soon become self sufficient in designers and engineers.
Very true. We've held on to the design jobs because we are the market for those goods. Now that China is trying to sustain its economy by turning its own citizens into a consumers, we will lose that edge. That said, I can't think of any Chinese companies that trade on their industrial design... even Japanese products are mainly sold as being functional.
Ridiculous: When I was at college around 2000, we were advised to learn German, Hebrew or Japanese... because these countries were the only ones to produce high tolerance tooling for injection moulding. Any industrial designer now should be learning Mandarin.
Of course Dyson isn't responsible for wages being lower in the East. The even bigger question should be "Why is our economy based on limitless growth when we only have finite resources?" The first industrial designers were stage-designers recruited from Broadway... at the time that people first became 'consumers'. Prior to that, things just looked like what they were, and you only bought what you needed (unless you were wealthy and could commission an artisan). To pick on Dyson again:
"Why are they still in business? Surely everybody already has a vacuum cleaner!"
(Mine's a Henry... or a Karcher if it's been raining too heavily)
He's talking about design and engineering, not manufacturing processes.
It's people like you who assume that a CD costs pence to make and therefore everything else is pure profit.
Well I worked for Dyson as an engineer until the end of 2008, when they decided that they didn't want so many engineers and technicians in the UK. The rolls were transfered to Malaysia, and approx half the engineers were made redundant. At the time, designs were also being done by engineers in India and China.
@John Liburne - We manufacture quite a lot here, it's a bit of a myth that we don't. Currently the UK makes more cars that it did in the 1970s/80s when most people here drove British cars. The only difference is that the cars are now seen to be Japanese or German, they're still British, though.
As it has ever been with England. It might be a bit beyond your reckoning, but 200+ years ago, one of the undercurrents of revolution were fed by similar realities: England didn't grow much stuff, but it imported and processed much of it and made it difficult or illegal for its colonies to do likewise. You keep the high value work and farm out the low value work. It is the way of the world. Possibly because there are locations for which the "low value work" pays a rich man's wages in comparison to his country-mates.
"That Dysons are made abroad does not stop Silicon Roundabout being bullshit"
The Silicon Roundabout is bullshit because there were loads of tech companies there long before the Libdemtards elected the Tories, not because it's implicitly bullshit. There's some serious cash and real companies floating around in between all the appstore entrants.
Thing about Dyson is he seems to be arguing for people to be on wage competition with Chinese people with everything he does and says. As a well qualified and experienced mechanical engineer to now writes software (for a company right next to the Shoreditch faddy app-about), on behalf of all of us: please shut the f**k up and hand back your KBE you clueless t**t.
> a serious lack of engineering graduates in the country. He claimed there would be a shortfall of around 60,000 people this year
Oh goody! That level of scarcity, if it REALLY does exist, means that engineering salaries will rise massively in order to attract people into the industry.
What's that I hear you say, Sooty? Engineering salaries are as low as they've always been and graduate engineers can't get jobs? Maybe there isn't a shortage of engineers at all. Maybe the only problem is that people like Dyson (who, given the quality of some of his products - not known as "Die soon"'s for nothing) simply aren't willing to pay the going rate and just want 60,000 CHEAP engineers, rather that well trained ones.
Spot on - I've registered just to make this comment. I graduated with an MEng 3 years ago now.
There are still 20-30% of my fellow graduates struggling to find engineering jobs, all with >2:2 MEng from a top 5 UK institution.
There's no shortage of good engineers. What there is a shortage of is companies willing to employ graduate engineers rather than trying to find someone who has done it all before. My current employer (an engineering firm ) had an average age in the high 40s until they recently introduced a new HR policy to hire more graduates.
That was how I got the job I'm in now, otherwise I'd still be on shitty zero hour contract jobs / security work / anything else I could get.
I'm also paid the least out of all my mates who did other courses (BBA, Coach Ed). The best paid of the guys from my course now work in the City in Finance, using approximately zero of the course we all slogged away at for 4/5 years...
Incidentally Dyson didn't even reply to my or any of my friends job applications when they were advertising in 2011.
Says it all really.
Should have done a proper subject like media studies mate
I got my MEng 15 years ago. I was a silicon designer for a few years and then realised that there was sod all career progression. Yes, you could become a senior engineer, "distinguished" or whatever the hell they want to call it. You won't earn much more though.
I moved into the IT side of things, and while I still earn less than half of those I know who went into the financial industry, I earn a hell of a lot more than I would have if I'd stuck with engineering. I enjoyed doing it, and still would if I was now, but I'd rather live comfortably.
This is similarly true in software - while there are companies crying out for staff, compared to the international scenario the pay for software folks in the UK (even in London) is frakking awful when compared to the US, Australia and other western nations. Maybe we do need more STEM grads, but unless the money's there at the other end why bother?
The only way I can get close to what I was earning in 'stralia is by contracting.
Sounds very similar to me. I did my first degree in Aeronautical engineering whilst working for a large European Civil Aviation company. I enjoyed the job, but the pay was only ever going to be mediocre (Unless you got to Exec level which was impossible unless you liked playing Golf with various senior Execs). So I went back to Uni in 2003 and did a BEng in Computer Systems. I'm certainly not on crazy money, but enough to afford a house, a car and a few hobbies. I have far more prospects than my Aero engineering days anyway!!
It keeps all of the media luvvies in one place which means it's very easy to avoid, especially when job hunting.
Or come the revolution!
They could also work on getting those 26% back into engineering. I'd actually quite like to do that (I only got lured away when the engineering company I worked for went bankrupt - so I do actually have some experience as well as the paper qualifications) but the salaries do need to get a little more realistic. I'm not suggesting parity with e.g. the finance industry (to pick a totaly random - honest! - example of where someone might get lured to) but for practical/personal/family reasons many people just can't take the kind of salary cut or relocation that would be likely. Would also need employers/recruitment agents to be more flexible with people who can't tick all the boxes for "must have 5 years experience with x,y and z". Perhaps Sir JD should set up some kind of agency to do that ...
This from the guy that was once touted as the saviour of British Engineering and then quietly offshored his manufacturing to Malaysia or the far east somewhere if i remember correctly...
Now thats what I call sticking up for Britain.
That argument has been debunked above, but in addition - often manufacturing abroad means companies stay afloat when often they would have died a slow painful death at the hands of overseas competitors. And even if it wasn't necessary to stay afloat, the extra money can be ploughed back enabling the employment of higher paid higher level staff - as happened with Dyson. It won't have happened in every case of course, but Dyson does not deserve your ire on this one.