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The Luxury Goods Industry Deserves State Aid

25/11/2016 13:12

'Always trust a person who knows how to accessorise'. It's been my guiding maxim over the years, and yet again, it has been proven true. Our sublimely decorated PM has put her money where her Jimmy Choo's are and is getting involved in industry. No more tinkering at the edges of our national prosperity, we're getting interventionism, and I can't wait. It seems that the clever types in the space sector are getting the bulk of the help. And they deserve it: microchips, wires and shiny mirrors in orbit seem to be flying of the shelves. We should become a world leader in all things other-worldly.

But before she spends it all on the men and women in lab coats and rubber-soled footwear, I want to make a pitch for another sector who will do the nation equally proud.

The luxury goods industry may not be able to bedazzle with logarithms and long division, and communication with extra-terrestrial lifeforms isn't its strong suit, but it is already one of the biggest industrial sectors in the UK. With help, it can be bigger.

When the world economy putrefied, for some strange reason the global demand for silk scarves and silver teapots sort of held steady. Dipped, yes, but its immaculate head was back above water quicker than you could say gold brocade. The international demand makes the sector almost recession proof. Expected to be worth £51 billion by 2019, 71 % of current output is exported - making it the highest net exporting industrial sector in Britain. And it is growing - quickly: exports are growing by 12% annually. And a Chinese wobble isn't set to damage things; America is back alive and consuming again. Thankfully, tufting is fiddly, hands-on work: the industry is forecast to employ 158,000 people by 2019 - almost double that of shipbuilding.

Don't help the shining stars. Burberry sparkles without assistance. Take the same approach as with the tech sector: help the young starts-ups - the talent who are hunkered in an attic studio, wearing roll-necks, creating wonderment - but wondering if anyone will ever see it. For Britain, Economic salvation is in the SME's - this we all agree on. But luxury fledglings need more than an ad campaign with posters declaring that they are great to passengers arriving at Heathrow. They need easier access to start-up and development funding; government muscle to hustle them into new markets; subsidies for tuition fees on related degrees.

The Made in Britain brand is our strongest asset. Globally it evokes quality, reliability and romantic nostalgia. More so for the luxury good sector. New industries need to pitch their credentials to world consumers - not so with luxury exports. The international customer is not only convinced of brand Britain, but are hungry for it. Its pushing at an open door and government's help will push it wider. This is a tried, tested and proven sector: the products are known, the markets identified, the routes to the consumer established. With government effort it can employ more, export more and earn more, quicker than any start-up sector. It's as close to a sure-fire-thing as we have got. But without government assistance to nurture the new talent, the sector will stagnate.

It's too easy to dismiss the government's plans and intentions as ineffective bluster. I don't think that they are. It takes political stomach and intelligence to be interventionist in today's world. I feel that they get business, but we must remember that they are having to bob and weave around events in these extraordinary times and juggle the dozens of fireballs which make up a nation. We have no charts for the waters we are about to enter. We could find calm seas and a new age for Britain, or we could run into a storm of apocalyptic proportions, and sink into the deep, a few scraps of pin-stripe cloth and a bobbing bowler-hat marking the watery grave of a once-great economy. No intelligent person would ever claim that they can predict which it will be. We have to know who to directly support - and who to cut lose, in the words of Coco Chanel, 'don't spend time beating on a wall hoping to transform it into a door.' The smart (and scarce) money needs to go on what will flourish, not on the tending the tombstones of our industrial past. Move over steel, hand-quilted handbags will take it from here.

The substance behind the style of our Prime Minister is beginning to reveal itself. But she should turn to the luxury goods sector for more than her kitten heels. As within the stitch-work is woven national salvation.

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