Chemicals manufacturing

Sector introduction

The chemicals manufacturing industry is the sector concerned with the production of chemical products by large and small businesses. It is a critical part of the UK's trade supply chain, supplying manufacturing industries from aerospace to pharmaceuticals with materials and goods. The industry also supplies products to many parts of the retail sector, especially the food and drink and personal care sectors. The sector is strictly regulated, energy intensive and highly skilled.

Chemicals manufacturing is composed of a range of sub-sectors, including basic chemicals; fertilisers; gases; paints and dyes; inks; coatings; plastics; rubbers; man-made fibres; pesticides; soap and detergents; perfumes; glues; and explosives.

As of 2009, around 140,000 people are employed directly in the sector, and through supply chains around three times as many are supported by the chemicals industry [Chemicals Industry Factsheet]. There were 3,619 recognised companies in the sector in 2009 [Annual Business Inquiry Survey, 2009].

Turnover has shown significant growth since 2005, reaching £42.97 billion (excluding paints) in 2008 [Annual Business Inquiry Survey, 2009]. Over the last decade the industry grew more than five times faster than the average for all industry, driven by productivity increases. A Gross Value Added (GVA) of £9.34 billion equates to an average GVA per employee of £89,029, compared with a national average of £31,419. The industry exported £24bn and contributed £1.7bn value added to the UK economy in 2009, adding £30m daily to the UK balance of trade.