The British Productivity Malaise

Though this post refers specifically to the UK, there are lessons for most nations … o don’t turn the page… read on!

UK productivity stagnated some times ago and has been bouncing along the bottom of most nationality comparison charts for too long.

Serval people far more important than me have tried to explain the reasons behind this state of affairs…. But from what I’ve read, these people know little about productivity.

Liz Truss, for example, was very briefly the UK Prime Minister and she talked about UK workers, and especially those in the north, having to ‘pull their weight’ and ‘graft more’.  The only thing she got right here was the recognition that productivity in the North of the country is significantly lower than in the South.

Did she stop to think why this might be?  It doesn’t seem like it.  She just assumed that since productivity is measured in terms of GDP per worker or per hour worked, it must be underperforming workers that are responsible for the North-South divide. 

(Though I have named Liz Truss (because if the leader of the government does not understand the issues, why should anyone else) this view is shared by many others amongst the ‘great and the good’, the policymakers and strategists.

However, the ‘gap’ or divide is a result of UK exports depending largely on financial services- and financial services firms being largely based in the South of the country.  This is a structural, geopolitical issue and drastically skews the productivity figures in favour of the South.

Now,I am not suggesting that we should not concentrate on improving productivity in the North but to start from a position of blame and recrimination does no good at all.

We need to ensure the North receives the same level of investment as the South, that Norther workers have the same training and development opportunities and that the northern infrastructrure is developed.  (We have in the government a ‘levelling up’ secretary of state … what are they doing?)

Poor productivity is rarely a symptom of, or the result of, poor work rates; it is almost always the result of under-investment, poor infrastructure and poor systems.

If you understand the problem ,you have some chance of solving it.  Those politicians who take the easy line (workers need to graft more) are simply demonstrating that they either do not understand the problem or find it too difficult to solve, so make sure they pass the blame (and the buck)