New MPA research highlights vital economic role of mineral products

New research from a leading economic consultancy has highlighted the critical role of the mineral products industry to the UK economy.

The 6542 Capital Economics (CE) research has found that the UK mineral products industry makes a Gross Value Added (GVA) contribution to the UK Economy of over € 4.97 billion (£4bn) a year – greater than creative industries such as film and video and not far short of motor vehicles and aerospace; generates an annual turnover of € 11.2 billion (£9bn); and has labour productivity 2.5 higher than the national average.

Further research by CE found that the mineral products industry supplies industries with a turnover of € 497.8 billion (£400 billion); is the largest supplier to the            € 149.34 billion (£120bn) construction industry; pays over € 1.24 billion (£1bn) of taxes annually; employs over 70,000 people; and makes significant economic contributions throughout the UK.

In a unique analysis, CE also assessed the significance of the industry by modelling the economic impact if the UK had no indigenous supply of aggregates, finding that relying on imported aggregates would have led to a loss of UK GDP of € 24.89 billion (£20bn), or 1.5%, over a fifteen year period.

Commenting on the CE report, Nigel Jackson, chief executive of the 2897 Mineral Products Association (MPA), said: “We wanted Capital Economics to carry out an independent assessment of the economic significance of our sector and have been surprised by the results. Even taking account of the 30% loss of output during the recession, the industry’s Gross Value Added (GVA) contribution indicates the critical value of the industry to construction and many other important sectors. We are clearly an enabling sector and vital to the emerging UK industrial strategy.”

Jackson stressed how the MPA has repeatedly urged Government to minimise the cumulative tax and regulatory burden and free up the planning system to create conditions that genuinely support investment.

“The recent flurry of policy changes and announcements show little sign of accelerating growth, and urgent focus needs to be given to delivering more action on the ground on housing, transport and energy infrastructure, and the nationwide need for more repair and maintenance.” he added.