Britain does not have a productivity puzzle

Welcome back. Britain’s weak productivity increased in a good year in ten years. Problemi möhkəm, sektoru və bölgə ilə parçalayan, sub-submelyenin sub-submektarını yumurtlamışdır. The main culprits for the slowdown of Britain, but mostly remained the same.

So I claim that there is no “Productivity Puzzlensi” in the UK this week.

Economists tend to model a nation’s output as capital and labor function, and the two (as well as productivity is also known as productivity) and how effective combines. Output in the hour is the most common measure of productivity.

After the global financial crisis, the slowdown in productivity growth is a phenomenon worldwide. However, the opening of England was the starter of the Britain, compared to the previously solid trajectory.

“Slowly is the result of weak capital per employee near one third of one-third,” Bart Van Ship, a managing director at the British Basic Productivity Institute. “Two-thirds of the other two are made from poor contributions to the total factor productivity.”

Indeed, 2008 after the United Kingdom, the production capacity of the United Kingdom has expanded its production capacity by increasing its ability to work. However, in this period, improve broader efficiency and the investment was left behind.

Currently, in the middle of the G7 of G7 for England, in the middle of the GDP, work on purchasing parity in the hour, about 20 percent.

“British workers must do with less capital from colleagues in the field of higher productivity, as well as Tera Allas, McKinsey’s commissioner,” Research and development, training and infrastructure have collected, research and development and infrastructure. “

In the last ten years, business investment also suffered from high levels of economic uncertainty. This includes the 2016 referendum, political turbulence (between 2019 and 2022) and the years of negotiations in postparty pandemic cycles.

As for the growth of weak TFP, there are more than one explanatory factors. For beginners, weak investment can worsen the results of efficiency over time. Using the old technology, Knock’s innovation prevents. The infrastructure wears and sheds tears and the population is expanded.

“There are a mass transit system (tram or subway) in each French city with more than 150,000, it is also a very large city and city,” Ben Hopkinson, Britain Research Head in Britain Remada.

Weak management skills are another problem. One Last Research An average of 4.9 percent of domestic production firms, more productive and foreign managers, more than 23.3 percent more capital. “The spread of the best practices and technology between enterprises and areas is more slowly in Britain,” said Van.

Next, English adults are the most worst of the average OECD average for OECD’s literacy, countdown and problem-solving skills, the richest peoples of the country corresponding to employees in a qualification level. According to the education request department, in 2022, more than a third of all vacancies were the result of skill shortages.

However, this is not only in terms of definitely, but also an investment function in the publication of the country. “It is due to the experience of good-paid work near workers, noting houses in our most productive cities and around and around,” Hopkinson says. “Lack of reliable mass transit reduces the effective size of our cities by limiting where they can easily go to the city center.”

The capital is shared. Pension funds in Britain have been transferred from the UK capital for more than two years. This turn did not happen in another Basic Pension Markets. This includes the scale opportunities for local companies, along with the wider challenges to find enterprise capital.

Then there’s a red ribbon. For measurement, the UK’s tax code is more than 22,000 pages from any other country in the world. This Federation of small businesses A small company estimates that a year, 44 hours a year and all small enterprises spend an average of a year-old company to $ 25 billion.

The code itself, income tax and business include numerous neutralities, growth and investment incentives, growth and investment promotions, growth and investment promotions, growth and investment promotions. Neidle from the UK Tax Specialist describes them here.

The building also requires heavy paperwork to slow down projects. As a rejection of Britain, the reduction of 3.3 miles to Portishead for PortishEd received 79,187 page planning document. Printed, this is 14.6 miles documentation – the length of the real railway 4.5 times. It took 16 years to date. (Construction should start soon.)

All TFP microanalizations have two extensive macro factors that inclined to lose.

First, England is the world’s highest in industrial electricity costs, which is the highest in the world. “Because the energy potential is destroyed or mothed,” the tendency of the British productivity in 2005 has been made in 2005. “Simply exist, the more goods and services can be produced at competitive prices.

The second one is demand. Weak wage is a function of increasing weak productivity. In Britain, since 2000, the growth of average earnings has only been changed in the price level. However, compulsory expenses increased higher than salaries, including home prices, parliament tax, utilities, education and childcare care. The public sector is the center of this.

Compressed household budgets CRIMP internal sales income and effect investment plans. According to quarterly CBI inquiries, for 2010, the average of the British services in the average of 80 percent of the companies in business as a restriction in business. 50 percent of production firms said 50 percent of sales of sales in the same period.

The separation of England from the EU recently limited access to a large foreign market. The demand for English exports has weakened since 2020.

This is just one image of the factors that manage Britain’s productivity. Many of the measurement issues. Access to the service sectors, it is not easy to capture the intangible login and knowledge. He said that it could be explained enough with clean obstacles. “There really doesn’t really find a puzzle.”

This is surprising how little this productivity blockers change in my career in the British Bank in early 2010: weak investment, scale problems, regional inequalities, skill deficiency, etc.

England is still talking about the same problems. I admit that the fundamental political bandwidth is absorbed by brexit and related instability. The investment problem has also recently attracted a policy: the United Kingdom presented a full-time tax concession for capital investment in 2023; The existing government focuses on the planning system of the labyrinth and the capital of the pension fund.

For more than a decade-old growth plans, white documents, government surveys and meditation, the English research has shown it very little to improve growth in the UK.

Solutions are known, but it is difficult to hand over to productivity policy. Buying an old, existing infrastructure can be bigger and more difficult than scratching. Finding optimal adjustment level is not easy. The risk of alienation of a group while the main tax reforms benefit another. Building nimbys in the building. For example, according to health, education and education, it can take years to give fruit, that is, fighting to fight for traction. Initiatives cannot survive the next government by limiting the effectiveness.

There is an investigation into less action for the preparation of practical solutions to make the country’s productivity falls, but to convert. England is not alone here.

There is a riddle in the UK. But not productive, but one of politics.

Send your rebutals and thoughts freelunch@ft.com or x @ TeamPperikh90.

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