PwC comments on the Industrial Strategy

Rachel Taylor, government and health industries leader at PwC said:

“Industrial strategy without business is just a wish list. The UK Government’s new Industrial Strategy sets a welcome and clear direction but it’s business that needs to turn ambition into action.

“The strategy talks a good game on skills, but we need to light this flicker of ambition to ignite the skills revolution businesses and industries need. There is little to address the urgent need to upskill the existing workforce, which is a missed opportunity when we know 80% of the 2030 workforce is already in the labour market. Targeted incentives for employer-led training and a sharper focus on upskilling the existing workforce are essential if we’re to meet the demands of a modern, high-value economy.

“Business is not a passenger on this journey, it’s a partner, and leaders are ready to lean in. Local delivery will be decisive. Whether it’s advanced manufacturing in the West Midlands or life sciences in London, we must empower public-private partnerships to drive growth where it matters most. That means flexible funding and greater control for local leaders to deliver lasting economic change.”

Matt Alabaster, partner at PwC, said:

“The UK’s chronic underinvestment is the root cause of our stagnating productivity and sluggish wage growth. Analysis shows a staggering £2 trillion investment deficit compared to our G7 peers – a gap that cannot be closed with short-term fixes. If growth is truly the mission, then global capital is the fuel – and the UK must become the destination of choice.

“A long-term industrial strategy, backed by business and delivered consistently by government, is a vital first step. But let’s be clear: the money won’t come from down the back of the UK’s sofa. Government capital spending, while welcome, only scratches the surface – its annual increase covers just 67 days of the levels of investment the UK has lost. And the £2trn deficit is approximately equal to the entire market capitalisation of the FTSE100.

“If we’re serious about turning the tide, we need to unlock the world’s deepest pools of capital – from sovereign wealth funds to global pension giants and tech titans. That means making the UK a magnet for international investment. The Office for Investment must be empowered to act as a bridge between ambition and action.”

Vicky Parker, partner, Energy, Utilities and Resources Leader, said:

“The unveiling of the UK's Industrial Strategy represents a very welcome and much needed moment for businesses, particularly as energy will continue to be heavily influenced by geopolitical events and an increasingly complex global economic landscape. By addressing two of the most pressing challenges—high electricity prices and prolonged grid connection waits—this initiative demonstrates a strong commitment to fostering an environment where businesses can have the support to grow and compete internationally.

“With the British Industrial Competitiveness Scheme aiming to reduce electricity costs for thousands of energy-intensive sectors from 2027, this will give welcome financial relief. This is particularly important given 83% of organisations which PwC surveyed earlier in the year expected their energy consumption to rise in 2025. Through the Government’s British Industry Supercharger package, around 500 businesses in energy-intensive industries such as steel, chemicals, and glass, will also benefit from an increased discount on electricity network charges, increasing from the existing 60% to 90% from 2026. 

“However, policy makers will no doubt be watching ongoing geopolitical events, particularly in relation to oil prices, with the Brent price rising to a five-month high over the weekend, having now stabilised. If prices were to spike considerably, this would raise questions over the overall policy affordability and reignite the ongoing debate as to how to ensure the UK manages its exposure to ongoing volatility in energy costs. It is also clear that these measures go a long way but will only tackle some of the market; a whole-system view combining demand and supply side measures therefore remains essential to support a balanced and affordable transition. 

“Additionally, the best saving is the energy we don’t use, so in parallel, it would be extremely beneficial to encourage discussion on measures to support companies to invest in energy efficiency, as well as incentivising private investment communities which are eager to finance the broader energy transition.”

Cara Haffey, manufacturing leader at PwC, said:

"Manufacturing in the UK has been hampered due to high energy costs for far too long, today's announcement is a game-changer for manufacturers across the country who ‘currently pay some of the highest electricity prices in the developed world’. Our Framework for Growth research also identified skills as a critical issue impacting competitiveness and growth. It cannot be overstated the impact this has had on the industry historically. The emphasis now is on strengthening collaboration and scaling up – this will be vital as we navigate the global competition as a relatively small nation. By implementing a regional, place-based excellence strategy, manufacturers can unite their efforts and enhance their competitive edge.

“Integration of plans and policies will also be welcomed by Manufacturers, specifically in energy, innovation, skills, trade, and foreign direct investment – alignment will enhance long-term sustainability and resilience. 

“Our nation is home to exceptional technical engineering expertise, positioning us perfectly to lead in scaling and reshoring manufacturing efforts. Now we have the support in place, we must maximise the opportunity this presents, now is the time to rise and to perform for the UK economy.” 

Barret Kupelian - UK Chief Economist at PwC, said:

“Today the Government unveiled a ten year whole of government industrial strategy, an important milestone that focuses policy and funding on the eight priority sectors.

“At a time of heightened economic uncertainty, Britain is replacing policy fog with policy focus, underlining the Government’s commitment to making economic policy more predictable. A credible industrial strategy means businesses can plan to grow with confidence, not just chase the next short-term cycle or worry about the next shock.

“Can this strategy end the UK's long term productivity stagnation? It certainly could. Evidence from advanced economies shows that every one percentage point of GDP devoted to industrial policy delivers, on average, a 0.25 per cent lift in labour productivity in that sector within two years.

“Nonetheless, there is still a mountain to climb: the UK still faces a cumulative capital gap of around £2 trillion compared with our peers. But productivity is not made in a day. It is built brick by brick and this strategy lays the foundations for tomorrow’s growth.”