PROFESSOR DYLAN JONES-EVANS

  Do we get the bosses we deserve?   Certainly, many of those leading organisations have views of their achievements that are poles apart to that of their employees. For example, a recent report from Deloitte showed a massive difference between those executives who felt they had done a good job supporting their staff during the last two years and those workers who felt otherwise.  Whilst nine out of ten of those in executive management said that they had understood what their employees had gone through the pandemic and they have made the best leadership decisions for the company, only half of their workers agreed with that sentiment. Perhaps the biggest problem, as this column as discussed previously, is that the style of leadership we see in an increasing number of organisations relies on individuals only being powerful because of their job or position, with this power acquired and maintained by a combination of patronage and fear rather than trust and respect. By h...

This week, the long overdue Levelling Up White Paper was published by the UK Government. Weighing in at 332 pages, it is a substantial piece of work that puts forward the case for addressing the economic inequalities across the UK.  Naturally, some critics have already suggested that it long on ambition and short on the funding needed to achieve that ambition. Nevertheless, it must be applauded for at least getting this important issue front and centre when it comes to government policy and also on identifying a number of broad objectives to ensure a more equal distribution of economic prosperity in every part of the United Kingdom.  These include boosting productivity, pay, jobs and living standards by growing the private sector (especially in those places where they are lagging) as well as spreading opportunities and improve public services in the weakest regions. By adopting a bottom-up rather than the usual top-down approach, it also intends to restore a sense of community...

One of the most important economic reports that is published annually is also one that is often overlooked by many politicians and policymakers despite its findings being relevant to the vast majority of businesses in the UK. The “State of Small Business Britain” report from the Enterprise Research Centre (ERC) reviews a range of research and analysis to present an annual review of the trends affecting small and medium-sized enterprises (SMEs) in the UK. For 2021, it is not surprising that the report has focused on the challenges that many small firms have faced in coping with COVID-19 but it also examines the opportunities to strengthen the sector as we finally emerge from the pandemic especially in terms of what is termed the ‘Triple Transition’ namely business digitalisation, adoption of net zero practices and the upgrading in productivity. What does the report tell us? Not surprisingly, one of the major findings is that SMEs have been in financial difficulties during 2021 with an i...

As we emerge out of the pandemic, it is becoming clear that many businesses will need to focus on improving their productivity over the next few years if the UK economy is to not only recover but also grow substantially. A key part of any improvement in productivity is that of increasing investment in skills and that is why this month’s survey from the CBI’s annual education and skills survey provides useful reading as to the future intention of businesses. The good news is that as we slowly emerge from economic downturn caused by the Covid-19 pandemic, most businesses will be increasing their investment in training and skills over the next twelve months. In fact, four out of ten will have a higher rate of investment in this area than prior to the start of the pandemic suggesting that owners and managers of firms are seeing this as a way of developing competitive advantage in the future. Whilst there is demand for skilled people at all levels, there is a greater need for those with hig...

Earlier this week, the campaigning think-tank Onward published a report which examined how supporting a renaissance in manufacturing could level up the UK economy.  It builds on some of the themes that have been reflected in this column over the last eighteen years namely that manufacturing - especially here in Wales - has been sorely neglected by politicians and policymakers despite the evidence that it is now an industry utilising highly skilled workers to generate high quality products that are sold internationally. Yet as the report shows, if the UK is to close the productivity gap with its main competitors, then there needs to be a greater focus on supporting the manufacturing industry. This is because productivity growth in manufacturing has been higher than the rest of the economy with output per job in manufacturing growing by 0.64% in manufacturing between 1979 and 2019 as compared to an average of 0.36% across the economy as a whole.  Given this - and the fact that W...

What have you missed most of being in lockdown for the last fifteen months? On a professional level, I’ve longed for the opportunity to go and talk face-to-face with businesses across Wales.  There was a month or so when I managed to get to see a few of the Fast Growth 50 winners in November to give them their trophies but then we went back into lockdown again for several months. Just having the chance to talk and share ideas with others is increasingly seen as important to the competitiveness of businesses. More importantly, there is growing evidence to show that greater collaboration between businesses leads to increased performance in terms of growth, profitability and productivity.  Yet it would seem that many businesses are reluctant to invest in good practices such as increased networking to improve their competitiveness. Indeed, it would seem that Welsh businesses are not fully engaging with this agenda outside the usual “speaker with a chicken dinner” gatherings. For e...

Last week, a fascinating economic outlook report was published by the National Institute of Economic and Social Research (NIESR) that focused not only on the impact of the Covid-19 pandemic but also Brexit. In doing so, it delivered a sobering assessment of the future of the UK economy as well as the differing fortunes of the regional and devolved economies of the nation. As with many other forecasters, the increase in Covid-19 infections during the last few months has resulted in the NIESR revising its economic growth forecasts for this year, especially with the lockdown of the last couple of months having a bigger negative impact on the UK as compared to last November. As a result, the NIESR suggests that the UK economy will only grow by 3.4% in 2021 although a more rapid rollout of the vaccination programme, along with the lifting of lockdown measurers, could change this.  In addition, the sluggish response of the rest of the World in vaccinating their populations could result ...

It was never going to be an easy task for the new Chancellor of the Exchequer to deliver a budget four weeks into his new job and with the ongoing crisis of the coronavirus outbreak at the front of everyone’s mind.  But from the point of view of the majority of firms, many would agree that he succeeded in making this the most business friendly budget for some time last week. Obviously, the headlines were his in initial efforts to support firms during the expected shutdown over the next few months to control the Covid-19 virus such as full business rate relief for the majority of small firms. Not surprisingly after the UK essentially came to a halt earlier this week, he vastly extended the amount of support last night by setting aside £330 billion of government guaranteed loans for struggling businesses with funding of up to £5 million available to each business with no interest for five months. No doubt this will be critical in ensuring that the majority of small to medium sized bu...

For those who are trying to get a handle on what is happening to the current global economy, the Global Competitiveness Index is not bad place to start.  Published by the World Economic Forum earlier this year, the 666 page report provides a detailed analysis of the factors that drive productivity, growth and human development in those 141 countries that account for 99 per cent of global economic output.  These factors include business dynamism, health, infrastructure innovation capability; labour market, macroeconomic stability and skills which, when put together, measure the competitiveness of each individual nation. The world’s most competitive nation, which has leapfrogged over the USA from last year’s ranking, is the small island economy of Singapore although it still has work to do in terms of encouraging greater entrepreneurship and improving its skills base. In addition, the East Asia and the Pacific region is the most competitive in the world, followed by Europe and N...

At the end of next week, the search for the 2019 Wales Fast Growth 50 will close with the list being published in a special Western Mail supplement and the achievements of all fifty firms celebrated at the annual awards in Cardiff in November. Since the project was established in association in 1999, the 602 firms that have appeared from 1999 to 2018 are estimated to have created 40,000 jobs and generated an estimated £20 billion of additional turnover, much of which is spent in their local area.  To date, there have been entries from some amazing Welsh businesses based across all sectors and communities in Wales and it looks likely that record average growth rate achieved in 2018 will be surpassed this year. Given the jobs and wealth creating ability of these growth firms at a regional and national level, it is not surprising that there has been considerable interest from both politicians and policymakers in how to maximise their economic impact.  Indeed, the latest report fr...

One of the major disruptive influences on the 21st century organisation over the last two decades has been the increase in remote working. This is not surprising, given the shift away from physical work towards more administrative based functions which has ensured that individuals no longer need to be in a single place to undertake their work.  In addition, advances in technology has made it easier for employees to work together on a range of tasks and projects without having to be in the same room or at the same location. Demographic changes to the workplace, such as the increase in the number of women within the labour force, has also meant that there is increased demand for flexibility both in the home and at work.  And, more importantly, there is increasing evidence that remote working actually increases productivity and wellbeing in the workplace, reducing commuting time (and potentially increasing working time) and enabling employees to fit their work around their lives ...

Politicians and policymakers have long recognised that one of the real challenges holding back the UK economy is the low level of productivity, especially when compared to our nearest competitors such as the USA, France and Germany. In fact, sixty years ago, the UK had a highest level of productivity in Europe but this has declined considerably since then. As a result, there have been a broad array of potential solutions proposed to address this problem in the last few years including developing a highly skilled workforce, building a modern infrastructure and encouraging greater openness and competition. As yet, it would seem there has been only a small impact on the productivity of the UK as a result of these initiatives which form a vital part of the UK Government’s Industrial Strategy. Indeed, the latest figures from the Office of National Statistics (ONS) released last month show that for the third quarter of 2018 (July to Sept), labour productivity measured by output per ...

With the UK moving towards an unsatisfactory agreement on Brexit, many are wondering what is the future for the UK economy after we leave the European Union. With much of the UK Government’s attention being focused towards negotiations with Europe, there is concern that there is very little being done to prepare the economic future of this nation. Given this, it was perhaps surprising to see a recent publication which highlighted an increased commitment to investment in research and innovation in the UK. The so-called “Allocations Booklet” sets out the Government’s commitment to reaching the target of 2.4 per cent of GDP investment in research and development (R&D) by 2027. To move towards achieving this target, additional investment of £7 billion in R&D has been announced between 2017 and 2022, which raises public investment in R&D to £12.5 billion per annum by 2022 and is, according to the UK Government, the biggest ever increase in public funding of R&D. P...

Improving the productivity of businesses in the UK is seen as one of the most important economic challenges over the next decade although the overwhelming focus on Brexit has ensured that, in the last two years, it has been put very much on the backburner by the UK Government in taking this forward. This is extremely worrying given the impact this could have with recent research from NatWest Bank showing that UK SMEs could add £57 billion a year to the economy if they were as productive as their counterparts in Germany. In fact, their research shows that whilst each German employee generates around £147k of output every year, UK employees generate less than half of that (£147k per year). According to NatWest’s study, the main issue is that entrepreneurs in the UK are uncertain of what they need to do to improve productivity within their organisations. Whilst over two thirds of SMEs believe improving productivity is important, two-fifths don’t know what productivity actually mean...

Last week, the Growing Value Wales Task Force - made up of leading academics and industrialists - published a ground-breaking report which examined the practical ways of harnessing the talent being developed in Welsh universities and strengthening research and development for the benefit of the nation’s economy. It is a timely piece of research given the imperative for the nation to become more innovative as we seek new opportunities following the decision to leave the European Union. Not surprisingly, the report emphasised that Wales remains in a relatively weak position with regard to the traditional metrics of research and innovation performance such as the percentage of GDP expended on R&D investments by firms. In addition, it showed that businesses are more likely to look to suppliers, clients and customers rather than seek external sources of innovation such as ideas from universities. This is despite the fact that there is high quality of research in Wales albeit wi...

One of the key concerns of politicians and policymakers in the UK is that of productivity, especially in terms of regional differences across the UK. That is why, after years of procrastination by successive governments, a new industrial strategy has been launched to deal directly with this matter. Whilst there is increasing agreement across political parties that there are issues over the distribution of industry which has led to an alleged North-South divide, there has been very little actual data to support this. That is until the publication, earlier this month, of a research paper from the London School of Economics which examines this topic in detail. “Industry in Britain – An Atlas” presents maps and charts setting out the latest data on firm location, together with geographic measures of employment, productivity, and innovation. More importantly, it challenges some of the accepted wisdom about the geography of industry across the UK. For example, finance – long thought...

One of the real mysteries regarding the current state of UK’s economy is the so-called productivity puzzle. which refers to the fact that labour productivity has stagnated since the economic downturn of 2008. This is very different to what has happened after previous recessions where productivity initially fell but then recovered and returned to previous levels. Whilst there has been considerable economic debate surrounding the causes of lower productivity and some attempts by politicians to address this issue, there has been little progress to date to explain what has been going on. That is why a recent paper which examines the link between management practices and productivity within UK manufacturing businesses makes fascinating reading. Those of us who have been working for many years within the academic discipline of business and management appreciate the growing evidence between the adoption of management practices and increased performance in terms of growth, profitab...

Data on the growth of the small business sector in the UK is quite difficult to find given the range of different sources of information that are rarely collated in one place. As a result, the recent publication by the British Business Bank (BBB) of its annual Small Business Finance Markets Report 2015/16 is to be welcomed. Whilst it focused largely on the financial environment for small to medium sized enterprises (SMEs), it also produced some important research on the scale and impact of the SME sector on the UK economy. It showed that SMEs – those employing less than 250 people - accounted for 99.9 per cent of all businesses in the UK in 2015 and, not surprisingly, are major contributors to employment creation in all sectors and regions. They currently make up 60 per cent of total UK private sector employment (i.e. 15.6 million people) but, more significantly, have been responsible for the explosion in jobs growth since the recession with 85 per cent of all new jobs being c...