Even without taking a look at the 255-page white paper unveiled by the UK government for tackling the countries productivity issues, it’s easy to assume that Brexit is a major factor that’s hampering Britain’s growth. And you can be rest assured that this assumption isn’t wrong.
The industrial strategy document released late last year was created with the intention of providing a clear roadmap that the country will follow to once again becoming a leading wealth creating economy especially through production.
But before the UK can begin to recover from its economic lull, it has to first overcome the following obstacles which were made apparent by the contents of the industrial strategy document;
Businesses from various sectors of industry in the UK all have a common complaint and that is the lack of relevant skills to put to work and ensure productivity. The problem of lack of relevant skills within Britain’s workforce is made more apparent by the country’ ageing population and less properly trained youths to replace them. The industrial strategy takes note of this problem by acknowledging the need for a focus on new types of skills as well as new and more effective ways of learning them. There’s a proposition for increased funding for stem subjects, and support for reskilling by creating a new national retraining scheme. But many stakeholders believe that these measures are insufficient.
Productivity is currently on the downside in the UK especially in comparison to other developed countries such as the US and France. This problem is apparent across various manufacturing industries ranging from producers of valve products to car manufacturers. The government intends on driving higher output per hour with a strategy to raise research and development funding, as well as generating more funding for technical and math teaching.
3. Digitalisation and technology
The increasing rise of the role of artificial intelligence and data in industries was recognised as a challenge for industries by the industrial strategy document. But asides from taking note of the challenge, little has been offered in the form of a proposed solution. The strategy however does suggest plans for the establishment of a new government “office of AI” but doesn’t specify how much funding will be provided to the office.
Then there’s Brexit and the lingering confusion concerning the terms and consequences of Britain’s exit plan from the EU. But one thing is clear, if the final Brexit deal ends up not being in favour of the UK, much of the content of the industrial strategy will be rendered irrelevant. Thus, until the air is cleared about Brexit, much about the industrial strategy lies in limbo as Brexit as it unfolds can significantly change circumstances.
In truth, the UK government is keen on re-establishing Britain as a leading world economic power but unless the challenges raised by the new industrial strategy are adequately put to rest, it is unlikely much progress can be made on the matter.