Skills key to increasing productivity

Posted on 25 Jun 2015 by Victoria Fitzgerald

Employment specialist, 2B Interface urges government to invest in training and apprenticeships to boost productivity in manufacturing.

As the Chancellor George Osborne is urged to raise productivity across the country, this week’s report from EEF, has found that despite the 4.8% downturn of the manufacturing industry in 2015, 40% of productivity gains over the next decade will come from the manufacturing sector.

Beatrice Bartlay, owner of specialist staffing agency for the manufacturing sector 2B Interface, has called for the government to invest in more training and apprenticeships to improve the skills of future candidates in the manufacturing industry, she said:

“The manufacturing industry offers great opportunities to the British economy, however since the recession it has not quite picked up the pace.

“As the latest EEF research underlines, manufacturing will play a key part in productivity across the UK and so it is time for the government to provide greater support for future workers in the industry through investing in research, training and apprenticeships.

“A fundamental part of the industry’s success will be dependant on the quality of future workers, and so it is important that they have the fine-tuned skills needed to help drive the industry forward, and help support its expected productivity standards.

“In order to operate effectively, manufacturing organisations will need to have access to skilled candidates that are readily trained, and greater apprenticeship schemes and skills training will help achieve this.”

“Moving forward, the manufacturing sector will be increasingly relying on the government for support, especially to help it surpass its pre-recession rate, and so it’s important that the industry’s potential for boosting productivity and the overall economy is recognised before it’s too late.”

Regional Growth Fund, Bentley, Motors, £1.69 million, Crewe, skills
The report found that higher skills levels are associated with more productive sectors and firms.

Commenting on the report, EEF director of Policy, Paul Raynes, said: “Ministers’ welcome commitment to improve productivity requires their forthcoming policy paper to focus on further investment in innovation, skills and infrastructure and avoid flat-rate across the board cuts for investment and public services indiscriminately.

“It will be tempting for the Chancellor to swing the axe equally across all unprotected departments, but instead he needs to cut with a surgical laser to make sure government’s real contribution to future productivity growth can be preserved.

“Ultimately, the private sector, and manufacturing in particular, will deliver the lion’s share of the UK’s productivity improvements, but the state can be a crucial partner.

“Manufacturers already lead investment in research and innovation and want to carry on working with universities and innovation hubs such as the catapult centres as well as their supply chain.

“Manufacturers must also be fully involved with developing apprenticeships and engaging with young people about industrial career opportunities.”

The report says that many of the critical contributors to stronger productivity growth are evident in manufacturing, including:

  • Exports: many manufacturers are exporters which exposes them to competition and can be a spur to improve management capability – manufacturers are more than twice as likely to be exporters than other sectors of the economy.
  • Research: manufacturing companies investment in R&D is six times larger than their share of output in the economy leading to the development of new products, processes and services and support the exploitation of new technologies.
  • Technology: manufacturers account for 29 per cent of investment in new machinery and ICT improving efficiency and accelerating the diffusion of technology.
  • Skills: higher skills levels are associated with more productive sectors and firms – between 2000 and 2013 the proportion of hours worked in manufacturing by employees with no qualifications has halved and the share worked by employees with a degree has increased by nearly 60%.