While the UK economy continues to do well, one area where we are still making no real progress is in the improvement of our productivity. It is absolutely right that we are now starting to focus on this challenge as increasing productivity is key to driving future economic growth, higher wages and better living standards. The business community has a major role to play in achieving this – and we must find a way to tackle this significant challenge head on.
A sustainable and long-term improvement in productivity relies not on people working harder and for longer hours. Instead, it must be about employers guiding their workforces on how to work smarter and equipping them to deliver more.
In practice, this means businesses must invest not only in hiring, training and retaining skilled workers, but also in providing them with the right tools to do their jobs more effectively. Every company must take a close look at its processes, provide the right training and also consider how to help employees harness the power of fast-changing technology.
This isn’t just rhetoric; this approach has been tried and tested and delivered real benefits in our own business at Hays. By investing throughout the downturn, we are now realising a real improvement in productivity in our UK business. Productivity was up 3% in the second half of 2014 alone, in contrast to the figures seen at a national level. Hiring, training and retaining the best people and providing the right technology to them to be even more effective at their jobs has been the core focus throughout. I think this same approach is directly relevant to other businesses and can deliver similar results.
I firmly believe that if we are able to build the best skilled workforce and invest to equip it with the best tools, we can deliver real improvements in the country’s output. However, businesses cannot do this in isolation; we also need support from the Government. Fiscal incentives to invest in training and technology, harnessing the power of our world-class universities, encouraging skilled migration to fill current skills gaps, investment in a strategic nationwide programme of skills development, including apprenticeships and even sharing insight from economies with higher productivity growth would all help.
In the meantime, however, those willing to invest and address the productivity in their own business have a real opportunity to positively impact the working lives of their staff and improve overall financial performance, in turn helping to secure future economic growth and a long term competitive position for the UK.
Alistair Cox is the CEO of Hays PLC