The concept of productivity has undergone something of a renaissance in the past few years, to become an overriding theme in government economic policy and a popular topic in mainstream media and political debate.
The reason is simple; productivity – defined simply as the amount of work produced per working hour – is widely acknowledged as the main driver of long-term economic growth and higher living standards. Yet growth in productivity has fallen sharply over the past decade as the UK economy has recovered from the recession triggered by the 2008 financial crisis. In fact, the UK has recorded the most acute slowdown in output per hour worked of any leading western economy, and the national picture is complicated by a high degree of variation across different parts of the country (see figure below).
Productivity is not the most straightforward of concepts and the reasons behind this stagnation are complex. It can also be difficult to relate this problem to our everyday lives and pinpoint exactly how productive (or not) a worker, company or industry is.
Nevertheless, a national imperative to boost productivity runs through various strands of government policy, manifested most recently through the national Industrial Strategy which is framed around ‘5 foundations of productivity’ (see Lichfields summary).
It isn’t surprising therefore that government aspirations to boost productivity have made their way into the world of planning policy, with the revised National Planning Policy Framework (published in July last year) now making explicit reference (at para 80) to the planning system doing what it can to help the cause (see more in our recent Insight). Those areas already supporting high levels of productivity (as shown in the map above) and innovation will be expected to lead the way, and areas with lower productivity will need to consider how to close the gap.
Yet productivity is a concept rarely explored in any great detail in plan-making or decision-taking, so planning policy-makers and decision-takers will be asking questions about how this translates into tangible measures and interventions at a local level, in a way that is relevant to local circumstances and growth challenges.
At Lichfields, we are increasingly advising our clients on this key matter and offer the following insight into what planning policy and decision making can do to respond to the productivity challenge, framed around the Industrial Strategy 5 foundations:
Please get in touch to find out more and to discuss how we can help.
The dust has now settled on the Government’s eagerly-awaited Industrial Strategy, published back in November 2017 to unveil a long term plan to build a Britain “fit for the future” (for a handy summary of its highlights see our Insight Focus and previous blog). Framed by four bold and ambitious ‘Grand Challenges’, the Industrial Strategy also defines some more immediate, short term deliverables in an attempt to galvanise different places across the country to respond to the national imperative and priority to boost productivity.
The most pressing of these is the requirement for Local Industrial Strategies to be brought forward by Mayoral Combined Authorities (MCAs) and Local Enterprise Partnerships (LEPs) (or devolved administrations in Scotland and Wales). These should set out a plan for how local leaders and businesses will work together to deliver growth. The first are expected by March 2019 and we have seen considerable progress being made up and down Britain to work them up. Local Industrial Strategies will become an important mechanism for places to ‘broker’ a favourable deal with Government for the resources they need to enable growth and development over the coming years.
In many cases, the geography covered by these Local Industrial Strategies will extend to sub-regions, growth ‘corridors’ and large metropolitan areas, so a key challenge will be showcasing a collective economic vision and cohesive plan for growth. This means that local partners – namely local authorities – have a strong incentive to engage with MCAs, LEPs and devolved administrations to proactively steer the development of local strategies to ensure their specific economic priorities and growth opportunities are given the prominence they need.
But in a competitive environment – where those who ‘shout loudest’ often win – local authorities need to be armed with robust evidence, a convincing narrative and a well-articulated case; avoid getting bogged down in detail and instead focus on concise and impactful justification. Above all, the onus is on individual authorities or groups of authorities working together to mobilise now during this current window of opportunity – while there is still time to influence and make a difference.
We have identified 4 key ‘building blocks’ for successful Local Industrial Strategies, summarised below. In our new product brochure, we provide some ideas on how local authorities can proactively shape the development of Local Industrial Strategies for their area, alongside some practical examples of the types of evidence and outputs that could be used to support this process.
This provides a useful way of thinking about the best means of interacting with the Local Industrial Strategy process. For instance, you might already have a good understanding of those industrial clusters of particular or unique economic significance in your local area, but need to demonstrate their full economic value in a ‘tangible’ way (see our recent example for Manor Royal Business District in Crawley). Equally, you might have a long ‘wish list’ of local projects and priority schemes but need to establish which ones are most likely to deliver value for money in the context of strong competition for finite funding and resources (for example see our Infrastructure Investment Plan for the Isle of Wight).
At Lichfields, we work closely with a range of different partners across the country to shape the collective economic narrative, vision and strategy to enable places to thrive. We can help by bringing our extensive experience and track record in supporting our clients to articulate their economic case, secure investment and assess their impact.
To find out more, have a look at our new package of services and tools which is specifically designed to help local authorities shape industrial strategies for their area, and get in touch.