The TUC has warned that British manufacturing is being damaged because other European governments are offering more state aid to industry.

In a report issued on Tuesday, the union umbrella group said that 770,000 manufacturing jobs have been lost since 1997.

Seeking to increase the pressure on ministers to act, the study said Britain was lagging behind its EU counterparts.

As well as a lack of government support, the TUC also highlighted weak work rights and low levels of business investment as key problems for the sector.

"With continuing low levels of government support and chronic under-investment, coupled with a workforce that is easy to flog and easy to sack, UK manufacturing will remain the 'weak wildebeest' of European industry," warned general secretary Brendan Barber.

"These are the drivers of recovery on which the government's manufacturing strategy review must focus."

The report highlights the competitive threat posed by higher levels of investment and productivity in foreign manufacturing.

But it warns that employers are wrong to use the threat of jobs going to Eastern Europe or Asia to keep down pay, increase hours and block improvements to workers' rights.