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The UK’s productivity rate has finally returned to pre-financial crisis level, according to the Office for National Statistics.
The governmental bean counters said that output per hour increased by 0.6% in the second quarter of the year, but said that the country’s productivity levels still lagged behind many major economies - 27% behind France, 30% behind the US and 35% behind Germany.
The new chancellor, Philip Hammond, has vowed to boost productivity as a means to improving living standards.
“If we raised our productivity by just 1% every year, within a decade we would add £250bn to the size of our economy – £9,000 for every household in Britain,” he said at the Conservative Party Conference.
Research suggests that the UK’s tech industries are increasingly becoming a key contributor to the economy, growing faster in turnover, gross value added (GVA) and productivity than most other sectors.
According to a recent report from Tech City, between 2010 and 2014, GVA from the tech sector grew 27%, adding an additional £19bn to the economy. Over the same period, jobs in the digital tech industries were 90% more productive than jobs in the economy overall.
“Digital is shaping the economy and presenting both challenges and opportunities for businesses across all sectors,” says James Parsons, founder and CEO of Arrows Group Global. “The reality is that all businesses should act like tech companies and a key component to this is the talent they have available.”
At the Canalys Channel Forum this week, the analyst house’s CEO Steve Brazier said that in order to maintain this growth trajectory, more needed to be done to ensure that there was enough talent in the pipeline. The chief exec warned that traditional hardware skills were dying out as the next generation wanted to become coders.
He said that the industry had to do more to make the traditional skills more attractive or there would be serious problems in the future getting hold of people with the right skills.
Organisations like TechUK have been lobbying the government to work with the tech sector to close the gap through a range of initiatives such as apprenticeships and curriculum changes.