Intellect, the trade body for the UK’s technology industry, has today warned that failure to address the UK’s waning productivity is undermining the economic recovery. Productivity growth rates have fallen significantly since the recession and need to increase by 30% for the UK to return to its previous levels of GDP growth.
The association, which represents more than 850 tech businesses, has published a report called “The Bootstrap Recovery” which argues that jump-starting productivity growth is critical to economic success. After 20 years of gains, UK productivity growth stalled at the onset of recession and has failed to recover. Intellect argues that weak productivity growth is jeopardising the economic recovery as it is eroding the UK’s long-term competitiveness.
“We have to turn what risks being a lost decade into a decade of renewal”, said Antony Walker, Intellect’s director of strategy. “There’s little prospect of a demand led recovery and quick fixes won’t be enough. We need a ‘bootstrap’ approach – a self sustaining process of renewal and structural change – if we are going to get the productivity uplift we need across all sectors to make the UK more competitive.”
Intellect argues that economies which have thrived and boosted productivity are those that have fully exploited technology innovation and have become ‘tech-excellent’. Intellect sets out the five pillars of tech-excellence and benchmarks the UK’s performance. The report says that the UK must shake off its complacency and go further to drive its competitiveness. To support this call Intellect is launching a national debate on productivity with politicians, industry leaders and employers groups.
“These are tough times”, said Walker, “but we have the knowledge, skills and capabilities in the UK to pull ourselves up by our bootstraps and rebuild our economy. Technology isn’t a panacea, but used smartly it can generate productivity gains that compound over time and make the UK more competitive in export markets and a better place to invest. That will generate jobs and get our economy moving. We’re not calling on government to spend money, but for a greater focus on productivity which will have a pull through effect for technology led innovation”.