A New Year’s Resolution We Can’t Afford to Break

As the clock struck midnight on 31 December and we all clinked our flutes of celebratory bubbly, I too was fizzing with excitement to be welcoming in not just a new year, but a new decade!

In many ways the change of digit draws a line under an unsettled and, for many, challenging period, and gives us all the perfect opportunity to reboot our positivity drive.

A century ago the world was a very different place, of course, but I don’t think it is too fanciful to hope that our own Roaring Twenties will go down in history as an equally dynamic and productive decade.

However, it looks like we’re starting off on the back foot. Imagine my disappointment to read this headline in the Financial Times just a couple of days into the New Year: ‘Poor productivity growth of 0.3% is “statistic of the decade”.’

According to the Royal Statistical Society, whose panel of judges awarded this dubious honour, the 2010s were the UK’s least productive decade since the early 1800s, back when George III was on the throne and the Napoleonic Wars were raging. And the steepest decline came during 2019, exacerbated by Brexit uncertainty.

This is in sharp contrast to the pre-financial crisis period of the late 20th century, which saw productivity growth averaging a healthy 20% per decade.

I couldn’t agree more with RSS Executive Director Hetan Shah, who stressed: ‘If the UK could lift its productivity we would be less out of sorts with ourselves as a nation, as we would have more money in our pockets and more money for government to spend on public services.’

This well-judged comment got me thinking about the bigger picture. It’s been proven time and again that productivity creates prosperity – and prosperity is transformative for individuals, businesses, countries and continents.

Both Romania and Ireland, for example, have bucked the trend of their struggling EU neighbours by recording strong economic growth throughout the 2010s.[i] Romania’s impressive track record in IT, research and development, and the services sector has attracted major multinationals such as Siemens, Ford and Bosch.

Fitbit co-founder and chief executive James Park has cited the country’s wealth of tech talent as the reason for the smartwear giant opening its prestigious new offices in the capital, Bucharest.[ii]

On the other side of the Atlantic, in defiance of the fallout from the 2008 financial crisis, the USA continues to feature high on the list of the world’s most productive nations.[i]  

According to the US Bureau of Statistics, the fact that American businesses still managed to produce 42% – or USD3.5 trillion – more output in 2013 than in 1998 with virtually the same number of labour hours is largely due to productivity gains stimulated by investing in faster equipment, hiring more skilled and experienced workers, and reducing material waste or equipment downtime.[ii]

The UK has been through some unusually tough times in recent years, both politically and economically, but as these examples prove, it’s eminently possible to turn things around.

As I posted on LinkedIn in a surge of passion when I read the FT article, both government and business need to wake up to just how important increased productivity is, and the difference it could make to the lives of everyone in the UK.

The Nobel Prize-winning economist Paul Krugman put it in a nutshell when he stated: ‘Productivity isn’t everything, but in the long run it is almost everything.’