The Office for National Statistics last week revealed new data on the UK’s employment market, productivity and economy. New data, perhaps, but it was – in the large part – the same old story. The number of people in work is falling, as is the number of vacant posts, and productivity is stagnating, bringing the climate more in line with what we saw after the financial crisis in 2008.
The scene looks as gloomy as a rainy November day. While it’s easy to shut the door on these problems, hunker down, and hope they all blow over – it’s not the approach which is going to help job-seekers, employees, businesses and the UK as a whole weather the economic storm.
Instead, the government and businesses should look to successes in other markets and aggressively invest in technology and R&D. India’s economy, for instance, is growing at an annual rate of 7.2% according to the World Economic Forum, due in part to the excellence of its research institutions and strong path to digitalization. Its high-tech sector is on course to attract a predicted $21 billion in investment and create millions of jobs. China’s economy too has boomed as a result of state investment in technology, and its Made in China 2025 initiative.
The UK is vastly different from both China and India, but then China and India are also both vastly different from each other. Investing in improving current digital infrastructure, alongside R&D into next-generation tech like AI, materials, robotics, biomedicine, augmented reality (I could go on), plays a pivotal role in economic success, no matter where in the world you’re based.
Even within the world of IFS, the results are clear; using our enterprise resource planning (ERP) technology, businesses are 18% more productive and report significant efficiency gains in areas like delivery and orders.
In addition to anticipating the ONS findings, many of us will also have been keeping an eye on political parties’ spending pledges as we approach the December General Election. We’ve had some bold (and some questionable) promises from leaders, but in my opinion, a dearth of solid commitments around technology.
The Conservatives have promised a £13.8 billion increase in spending across all departments, marking the biggest increase in 15 years. Labour meanwhile has committed to £250 billion of infrastructure spending, promised to provide free full-fiber broadband for every home and business, and aims to set the Bank of England a target to grow productivity by 3% per year.
This all sounds great in theory, but we all know that promises are not always kept. And even if they are, simply throwing a load of money at technology isn’t going to fix the UK’s productivity problem.
What’s needed alongside investment in tech is investment in appropriate training and re-skilling. This will help ensure that the UK workforce isn’t just equipped with the right tools, but equipped with the knowledge and education to get the maximum value from those tools. We’ve seen promising signs; the Labour party, for instance, recognizing the importance of adult education and current skills shortages has revealed a £3 billion plan to offer adults free access to retraining.
As with a lot of things over the past 12 months, we’ll have to wait and see if these promises come to fruition. In the meantime though, and with the ONS figures front of mind, businesses must urgently re-evaluate their investment in technology and skills and act on these findings to gain a competitive edge, even amidst the current storm.
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Photo by Graeme Worsfold