Professor Melanie Jones reflects: ‘What next for the Wales Productivity Forum?’
By Professor Melanie Jones
My recent appointment as lead for the Welsh Productivity Forum, which draws together business leaders, policymakers and academic experts to understand and improve productivity growth in Wales, has caused me to reflect. What have we learned so far and what should the focus of our future activities be?
The first three and a half years of the forum have laid out how important productivity growth is in Wales. As my predecessor, Professor Andy Henley, shows in our initial insight paper, Wales has exhibited persistently lower productivity than the rest of the UK and has experienced a slowdown in productivity growth since the financial crisis similar to the rest of the UK. This reflects multiple and interconnected factors, including low levels of business investment, average levels of educational attainment below the UK average and the lack of spatial agglomeration; that is, Wales does not benefit from the concentration of economic activity.
It is clear that there is no simple or easy solution, and that raising productivity in Wales will require sustained, coordinated and collective action that includes policymakers and business leaders, as well as workers themselves. We should also be under no illusion – significant change will take time and long-term investment. This, however, is not a reason to focus elsewhere, since the benefits of productivity growth are substantial.
Put simply, productivity growth enables us to produce and consume more goods and services with the same resources. It is the key to growth in real wages and forms the only sustainable way to enhance our standard of living.
The renewed focus of the Welsh Government on enhancing productivity in Wales is therefore welcome and particularly timely. A key priority for the forum is to inform the debate by transferring the existing evidence into practical insights for both policy and business. This requires us to improve understanding of what it means to be productive and set out the steps we need to take to achieve this.
Robert Lloyd Griffiths OBE, Director for The Institute of Chartered Accountants in England and Wales (ICAEW) in Wales and Wales Forum Chair, stated that “Our recommendations will draw on our collective expertise in productivity research and business practice, including learning from successful examples across countries, regions and companies”.
More details are available on the Wales Productivity Forum page, which is part of The Productivity Institute.
