Birmingham is an important manufacturing and engineering centre, employing over 100,000 people in industry and contributing billions of pounds to the national economy. Over a quarter of the UK’s exports originate in the greater Birmingham area.

Birmingham’s industrial heritage predates the Industrial Revolution, and up until the 20th Century the city maintained a tradition of individual craftsmen, sometimes working independently in their own back yards or on piecework rates in rented workshops, alongside larger factories. During the Industrial Revolution many factories, foundries and businesses prospered in the city, including the areas known as the Gun Quarter and Jewellery Quarter. Pen manufacture in Birmingham helped revolutionise writing across the world with many companies based in and around the Jewellery Quarter. The Jewellery Quarter is still the largest concentration of dedicated jewellers in Europe, and one third of the jewellery manufactured in the UK is made within one mile of Birmingham city centre. Until 2003, coins for circulation were manufactured in the Jewellery Quarter at the Birmingham Mint, the oldest independent mint in the world, which continues to produce commemorative coins and medals.

James Watt improved the Steam Engine while working in the city, and historically the largest manufacturers in the city have been associated with the steam, electric and petrol transport and power industries. The city’s workers designed and constructed railway carriages, steam engines, bicycles, automobiles and even - unusually for somewhere so far from the sea - ships, which were made as pre-fabricated sections, then assembled at the coast. Birmingham was home to two major car factories: MG Rover in Longbridge and Jaguar in Castle Bromwich. However, the future for the former looks bleak, as MG Rover went into administration in 2005, resulting in the plant being mothballed and the loss of 6,000 jobs at the site, plus more in the supply chain.

The city’s present day products include motor vehicles, vehicle components and accessories, weapons, electrical equipment, plastics, machine tools, chemicals, food, jewellery and glass. Scientific research (including research into nanotechnology at the University of Birmingham) is expanding in the city. Other famous brands from the city include Bakelite, Bird’s Custard, Brylcreem, BSA, Cadbury’s chocolate, Chad Valley toys, Halfords, HP Sauce, Typhoo Tea and Valor.

Birmingham has over 500 law firms, and is Europe’s second largest insurance market. The city attracts over 40% of the UK’s total conference trade. Two of Britain’s “big four” banks were founded there. Lloyds Bank (now Lloyds TSB) began in 1765 and the Midland Bank (now HSBC Bank plc) opened in Union Street in August 1836.

In recent years Birmingham’s economy has diversified into service industries, retailing, tourism and conference hosting, which are now the main employers in the city. Millions of people visit Birmingham every year, and in 2004 the city was named the second best place to shop in England after the West End of London [2]. Attractions for visitors include Birmingham Museum and Art Gallery, Millennium Point, Bull Ring, Selfridges Building, Cadbury World, Tolkien Trail [3], Birmingham Royal Ballet, and the National Sea Life Centre.

Modern economy

Today the city’s products include: motor vehicles, vehicle components and accessories, weapons, electrical equipment, plastics, machine tools, chemicals, food, jewellery and glass. Birmingham is home to two major car factories, MG Rover in Longbridge and Jaguar in Castle Bromwich (and Land Rovers are manufactured in neighbouring Solihull).

The Jewellery Quarter is the largest concentration of dedicated jewellers in Europe. One third of the jewellery manufactured in the UK is made within one mile of Birmingham city centre. Until 2003, coins for circulation were manufactured in the Jewellery Quarter at the Birmingham Mint, the oldest independent mint in the world, which continues to produce commemorative coins and medals.

As with most of the British economy, manufacturing in Birmingham has declined in importance since the 1970s, and it now employs a minority of the workforce. In recent years Birmingham’s economy has diversified into service industries, retailing and tourism, which are now the main employers in the city. Scientific research including research into the controversial nano technology at the University of Birmingham, is expanding in the city and will possibly play a part in the city’s economic future.

Over 500 law firms exist in the city and Birmingham is Europe’s second largest insurance market. The city attracts over 40% of the UK’s total conference trade. Two of Britain’s “big four” banks were founded in Birmingham. Lloyds Bank (now Lloyds TSB) began here in 1765 and The Midland Bank (now HSBC Bank plc) opened in Union Street, in August 1836.

Famous brands from the “city of a thousand trades” include Bird’s Custard, Typhoo Tea, the Birmingham Wire Gauge, Brylcreem, Chad Valley Toys, BSA, Bakelite, Cadburys chocolate, HP Sauce and the MG Rover Group; although no Rover cars are set to be produced in the future, with Nanjing Automobile Group to focus on the MG cars.

Economic history

For a more general history see History of Birmingham John Leland visited Birmingham in about 1538, and found many smiths manufacturing knives and nails among other products. By 1683, there were 202 forges in the town (mainly in the Digbeth and Deritend areas), and guns and brass goods were also being made. Metal was not made to any great extent in the town itself at this stage, but was mainly imported from Staffordshire and elsewhere in the West Midlands. Immigration to the city from the surrounding counties brought expansion of these industries. The population of the city increased from 5-7,000 in 1700 to nearly 24,000 in 1750, and by 1775 the population was about 40,000, making Birmingham the third largest town in the UK after London and Bristol. In 1791, Arthur Young described Birmingham as “the first manufacturing town in the world”.

By 1759 a House of Commons committee heard that at least 20,000 people in Birmingham and the surrounding area were employed in the “toy trade”, manufacturing buttons, buckles and other trinkets, with the trade being worth around £600,000 per annum (five-sixths of it for export). Matthew Boulton, in 1770, claimed that Birmingham’s superiority as a manufacturing town was largely due to the “superactivity” of the people, and the “mechanical contrivances and extensive apparatus which we are possess’d of”. The use of hand-operated machinery and division of labour (which might see a button pass through fifty hands in the course of manufacture) was commented on by many visitors to Birmingham. Children were often employed in this sort of labour, their work being made easier by machines.

In 1767, there were 35 gun-makers, and 27 manufacturers of other gun parts. The firm of Farmer and Galton supplied most of the weaponry to the Company of Merchants in Africa (i.e. the African slave trade). Pins, jewellery and papier-mache were also produced in large quantities in the city, and goods of all sorts were exported to North America and Europe (Boulton, in the same year, claimed that half his correspondence was in German).

The first cargo was transported on the Birmingham Canal in 1770, and the canal greatly reduced the price of goods such as coal which had previously been transported by road. The canal system was extended throughout the late 18th and early 19th centuries. Expansion during this period was also aided by the establishment of several banks - the button manufacturer John Taylor and the ironmaster Sampson Lloyd II established what was later to become Lloyds Bank in 1765, opening a branch in London in 1770.

Despite the establishment of several large manufacturers (for example Boulton and Fothergill’s famous works at Soho), most of the city’s manufacturing was done in small family workshops. Payment was usually by piece-work, and workers could therefore decide when they wanted to work - it was usual for “Saint Monday” to be a day of rest in addition to the weekend, with long hours being worked later on to compensate, and employers had very little control over the working hours of their employees.

The long-established industrial processes in the city meant that it was actually quite late in adopting the methods of the Industrial Revolution - manufacturing was so efficient and workshops so small that the steam engine, developed in Birmingham by Boulton and James Watt around 1770, did not find widespread use in the city for another sixty years (in 1815, there were only about forty steam engines in the town, many very small). However, steam power and improvements in iron manufacturing processes were important in the development of the nearby Black Country, which by the end of the 18th century supplied much of the metal needed by Birmingham’s manufacturing industries.

Numerous inventors emerged during Birmingham’s past, and the city’s skilled workforce and infrastructure encouraged other inventors and businessmen from across the world to set up shop in the city. (See science and invention in Birmingham).