Regional Productivity Disparities Tuesday 4 February 2020 Andy - - PowerPoint PPT Presentation
WIG Economic Growth & Prosperity Series Industrial Strategy Council: Addressing Regional Productivity Disparities Tuesday 4 February 2020 Andy Haldane, Chief Economist, Bank of England Emma Bridgewater, Founder, Emma Bridgewater
Andy Haldane, Chief Economist, Bank of England Emma Bridgewater, Founder, Emma Bridgewater Rotha Johnston, Commissioner, Belfast Harbour Commission Robert Zymek, Lecturer in Economics, University of Edinburgh For other WIG events & opportunities visit www.wig.co.uk Join the conversation @WIGuk | #WIGevents
For other WIG events & opportunities visit www.wig.co.uk Join the conversation @WIGuk | #WIGevents
For other WIG events & opportunities visit www.wig.co.uk Join the conversation @WIGuk | #WIGevents
Industrial Strategy Council
*University of Edinburgh and CESifo; robert.zymek@ed.ac.uk
– ‘unless we improve productivity, we cannot raise living standards and quality of life for all our citizens’ – ‘the UK has greater disparities in regional productivity than other European countries’ – goal: improving the foundations of productivity ‘in all parts of the country’
– higher disposable incomes – better education outcomes – higher life expectancy – higher labour-market participation 5
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Productivity across UK NUTS2 regions, 2017 (Souce: ONS)
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Top/bottom region productivity gap, UK and 18 EU countries in 2017 (Source: Eurostat)
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UK productivity differences across NUTS1 regions, 1901-2017
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UK productivity differences across NUTS1 regions, 1901-2017
Bristol…) have been “steaming ahead”
behind
Scotland…) have continued to account for >50% of local productivity disparities 10
Productivity growth across NUTS3 regions, 2008-2017
skill, health, motivation of the workforce a place is able to attract
machinery, equipment, infrastructure supporting local economic activity
inherent characteristics (location, culture) conducive to economic activity
composition of local economic activity (manufacturing? services?)
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Geography, local culture, governance, infrastructure shape economic activity ⇒ workforce composition, investment, productivity
specialised firms benefit from the ability to trade with other firms in their industry (e.g. Coventry-Warwickshire automotive cluster)
firms benefit from a common set of local resources offered by cities (e.g. infrastructure, market for specialist workers, knowledge transfer)
People choose to live and work alongside similar people ⇒ differences in productivity of places due to differences in productivity of individuals 12
– 1997-2010: Devolved Administrations (DAs) and 9 Regional Development Agencies (RDAs) in England to tackle productivity disparities – 2010-2015: RDAs replaced with 38 Local Enterprise Partnerships (LEPs); less dedicated funding and reduced emphasis on productivity – Since 2017: LEPs must develop Local Industrial Strategies (LISs) with local partners and government to access funding; renewed emphasis on productivity
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– A tendency to abolish and re-create institutions has hampered long-term planning and the build up of a meaningful institutional memory
– Strategies must be “narrative-proof”, employing a holistic approach across a range of policy interventions – They ought to aim for meaningful, sustained increases in productivity… – …while recognising that dramatic turnarounds are rare
– Contributes to balancing growth across the UK… – …and ensures highest marginal return from interventions
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Andy Haldane, Chief Economist, Bank of England Emma Bridgewater, Founder, Emma Bridgewater Rotha Johnston, Commissioner, Belfast Harbour Commission Robert Zymek, Lecturer in Economics, University of Edinburgh For other WIG events & opportunities visit www.wig.co.uk Join the conversation @WIGuk | #WIGevents
www.wig.co.uk @wiguk #WIGevents
With speakers from the National Innovation Centre for Ageing and UK Research and Innovation
With speakers from the Institute for Apprenticeships and Technical Education and the Department for Education