IoD: Dismal productivity data illustrates magnitude of challenge

Responding to official figures showing that quarterly labour productivity growth decreased by 0.4% in Q3 2018, Tej Parikh, Senior Economist at the Institute of Directors, said:

“Today’s dismal data illustrates the magnitude of the challenge we face in raising our productivity.

“We remain well behind the growth rates we saw prior to the 2008 downturn. For sustained increases in our productivity we need more support for skills, infrastructure and technological development at national and regional levels. This will be vital in securing our long-term prosperity, and in reducing our reliance on the whims of consumers in propping-up economic growth.

“The Government’s Industrial Strategy has been reined back by Brexit negotiations since it was announced in 2017, but this year the business community need to see tangible progress, otherwise we risk eating into our future competitiveness at the expense of politics today.

“Ultimately, with uncertainty hitting business investment and limiting policy headway last year we are unlikely to see a boom in productivity any time soon.”