Weak growth has been a persistent challenge for the Scottish economy. Despite the Scottish government’s long-held ambitions to see Scotland among the top 25% most productive countries in the EU, it remains 20% short of that target. But if business were to unlock growth across Scotland and close productivity gaps, our research shows that we could add £25bn to our economy over the next decade.
Productivity enhancement isn’t just an economic goal, it delivers social benefits too. Successfully addressing productivity goes hand in hand with higher wages and better living standards across Scotland. It’s the fuel that drives jobs, higher wages and secures future prosperity for all – which is why it’s such an important issue to CBI member businesses operating in the region.
As part of the CBI’s ongoing campaign Boosting Scottish productivity, we published a landmark report, Pursuing Prosperity, which highlighted huge disparities between different regions (the most productive local authority area in Scotland is 50% more productive than the least) and identified a series of key productivity drivers:
- Education and skills
- Digital and transport connectivity
- Innovation and management practices
We followed that up with a series of policy recommendations which proposed ways that government and business could work together to help deliver a much-needed step-change in overall levels of productivity.
But how can we begin to make the concept of productivity more tangible, so that Scottish businesses – which are ready and willing to embrace solutions – can begin to make the necessary changes?
The next phase of the campaign is to use benchmarking to assess the impact of productivity-enhancing measures. To do this, we’ve created an annual Scottish Productivity Index. The index will provide a simple dashboard that gives an overview of productivity levels in Scotland, alongside a companion report which delves deeper into the specific measures and outlines policy recommendations to deliver positive change.
The overall aim is to have a final product that offers practical solutions for both business and government to implement and improve productivity.
The easily digestible dashboard format will make simple for your business leaders to scan and pluck out the valuable information and ideas that relate to your firm. All data and analysis will be supplemented by insights from the hand-selected business advisory group, so the intelligence remains as relevant and impactful as possible.
The creation of the index will enable the concept of ‘productivity’ to become more measurable, which marks an important step along the productivity journey for both business and government.
The Scottish Productivity Index project is sponsored by KPMG Scotland, with expert insight and analysis from the Fraser of Allander Institute and Mark Diffley Consultancy and Research Ltd.