Rising unemployment, changing industrial processes and new ways of working have all combined to require a reconsideration by both public and private sector agencies involved in the production of industrial and business development properties in respect of what they build, where and for whom. The 1980s witnessed a transformation in both the location and property requirements of modern industries. Changing market conditions and the restructuring of the UK economy resulted not only in a substantial shift from manufacturing to service-led growth, but one that was coupled with the increased use of technology, resulting in new demands being placed upon both industrial and business premises. At the same time this was accompanied by organizational changes within key economic sectors and the emergence of a new wave of companies serving rapidly growing markets, both of which had a fundamental impact on the nature of demand for commercial property as a whole. These trends encouraged the creation of high-technology estates and business parks and are predicted to continue so to do as the economy evolves towards the year 2000 (Debenham Tewson Research 1991). In the context of this chapter, much of the material relates equally to industrial and business property.
The broad shift from manufacturing to a service-based economy is clearly reflected in the composition of both gross domestic product (GDP) and employment structure. Although the contribution made by the manufacturing sector to national GDP remained fairly constant throughout the 1980s, output from the financial and business services sector more than doubled from around 10 per cent in 1980 to well over 20 per cent by 1990. The long-term trend is forecast to continue through the 1990s, with manufacturing output rising by an average of only 2 per cent per annum compared with about 6 per cent per annum for the financial and business services sector.
The restructuring of the country’s economy is also reflected in changes to employment structure. Manufacturing employment fell steadily throughout the 20 years between 1970 and 1990, from 8.5 million to 3.1 million employees, a decline of nearly 40 per cent. During the same period, employment in the business and services sector rose from 2.6 million to over 5.6 million, an increase of 120 per cent. This trend is continuing, so that it is predicted that employment in the business and services sector will have increased by a further 20 per cent