At the turn of 20th century, decades before inward investment attraction became what it is today, Derby's local authorities managed to attract a start-up company operating in new but promising sectors of automotive and aerospace engineering to open a plant in the region. It was 1907 and the company was Rolls-Royce, now a multinational giant with annual turnover of $18bn.

Manchester, Coventry, Bradford and Leicester were among the potential sites being considered by the company but, eventually, Derby won the bid after offering a cheaper access to electric power. 'A rich package of incentives', it would be called in the jargon of modern-day economic developers. However, the electric rates were only part of the reason why the company selected Derby, according Graham Schumacher, head of development services at Rolls-Royce.

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“The city offered good access to land suitable for our operations, had co-operative authorities and, most importantly, its workforce had the right set of skills for us,” he says. “It is still the case today, otherwise we would not have stayed here.”

Large and small

Rolls-Royce not only stayed in Derby, it has become the city's biggest employer, with more than 13,000 workers in its Derby plant. Over the years, Rolls-Royce has been joined in Derby by other manufacturing multinationals such as Japanese car manufacturer Toyota, Canadian rail firm Bombardier, and construction equipment company JCB. Quite a list, given that in the 1980s and 1990s manufacturers have been trickling away from the UK looking for locations with cheaper labour cost.

Tony Walker, deputy managing director of Toyota Manufacturing UK, says that there is a strong case for staying in the Derby area. “Quality is very important to us and being based in Derby, a place which has a very strong engineering base, definitely makes sense,” he says. Indeed, Toyota is not only staying in Derby, it is extending its presence in the region. In 2011, the company decided to invest $155m in its Burnaston plan, located just outside Derby, in a move that is expected to create 1500 new jobs.

As much as they are among the region's biggest employers, Derby is not just about big nationals. Its wealth of engineering talent means that the city also has homegrown manufacturing success stories. One of them is Epm Technology Group, a carbon fibre composite manufacturer, established in 1996 by Graham Mulholland. “At that time I was 23 years old and I felt that the company I worked for was badly run. So I left and started my own,” he says.

The company has had a turbulent past and, in 2004, it was forced to reduce its headcount by half. Now, however, things are looking up for the firm. It supplies products to Formula 1 teams such as Force India, Lotus and Marussia and has more than 40 job vacancies to fill. The company is also planning to move to new facilities by the end of the first quarter of 2014.

According to Mr Mulholland, the fact that the company is based in Derby is reflected in the way that Epm Technology operates. “Our clients acknowledge that Derby tries hard to make things happen. They also see that it is reflected in the way our company operates,” he says. “Plus, engineering skills and attention to detail is what matters to us, and that is what Derby is all about."

Nurturing talent

The city's manufacturing tradition and skills are what most investors in the city point to when describing Derby. But years of gloomy forecasts about the direction in which manufacturing is going in the UK has taken its toll and deterred many youngsters from pursuing careers in the sector.

In an effort to remedy this skills shortage, many big local employers run their own apprenticeship academies in the area. Recently, local companies came together with the University of Derby and Derby College to set up the University Technical College (UTC), an engineering school for 14 to 18-year-olds. The school is expected to be opened by September 2014, and take approximately 600 students.

“Businesses in Derby are very enthusiastic about the project, as they will be able to grow their own employees,” says Liz Barnes, pro vice-chancellor at the University of Derby. Ms Barnes has been directly involved in setting up the new school. Although Rolls-Royce has played a major part in the project, she says that the school should not be viewed purely as an extension of Rolls-Royce's Apprenticeship Academy.

“We have meetings with employers from across the region, discussing how they can engage. Some will provide research projects, some case studies, some teaching or technology. We want to include as many companies as possible," she says.

High praise

UTC will not be the only addition to Derby's manufacturing landscape. After the city won a grant from the UK government's Regional Growth Fund in September 2012, work is due to start on the Global Technology Cluster (GTC), a high-tech campus expected to create 1000 new jobs by 2022.

“Derby is not just a place where trains or cars are assembled, it is also a place of high-tech innovation. GTC will confirm that,” says Nick Smillie, associate at AED International, an economic development consultancy.

Such is Derby's success that it has been praised by both the country's prime minister, David Cameron, and chancellor of the exchequer, George Osborne. Both paid visits to the city to acknowledge its part in the UK's manufacturing revival. During the opening of Rolls-Royce's Apprentice Academy in November 2012, Mr Osborne went as far as saying that “Derby represents everything that is right with the UK economy”. With the UK economy still far from robust, how many other cities can claim such praise?