Geographical Perspectives on United States Investment in the United Kingdom

American direct investment in Britain has a long history, dating back to 1851. In the past twenty years, however, the magnitude of US investment in Britain has dramatically increased. Events such as the closure of the Imperial Typewriter Co. at Hull and the threatened withdrawal of Chrysler from its UK manufacturing operations have served to focus attention on the activities of US based multinationals in Britain.

Direct investment by US companies has a very considerable impact on the UK economy. American owned enterprises employ one in every fourteen workers in private enterprise manufacturing and account for more than 10% of total output. There is a high degree of sectoral concentration in this ownership pattern with the main emphasis in vehicles, electrical engineering, mechanical engineering, and the food, drink, and tobacco industries. Spatially there is a particular tendency toward concentration in the South East. In terms of net gains over time, however, Scotland has fared particularly well in attracting US companies.

Within the North West of England there is also a tendency toward sectoral and spatial concentration. The motor vehicles industry on Merseyside represents the most prominent cluster and, in a region chronically prone to serious unemployment, there is potentially a degree of vulnerability which might give legitimate cause for concern.