It’s about productivity.
You may have heard that the UK has low productivity, but you may not know what that really means.
Productivity is measured nationally as our GDP divided by the number of hours we work.
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It’s an issue for government because compared to France, Germany, and Italy, we are less productive. We work longer hours, but we make less money. For example, a French worker assembling computer motherboards might be able to complete ten per hour, whereas a British worker may only average nine.
So why is this? Are British workers lazy?
Far from it. To understand why, we have to look at the wider picture.
It’s partly about training people with the right skills. Germany is heavily invested in apprenticeships. Kent County Council leader Paul Carter was left with egg on his face after Kent apprentice numbers dropped embarrassingly again this year, despite his pledge to double their number by 2020.
Kent currently lacks opportunities for young workers to complete high level apprenticeships that lead to good salaries and would help stimulate the regional economy.
Morale plays a big part too. Many of us have to commute long distances to work and pay a handsome sum for the privilege. Wages have stagnated over recent years and although unemployment has reached record lows, many of the jobs created are badly paid, self-employed or heavily reliant on the gig economy.
Another significant factor: for too many years we’ve relied on a supply of cheap labour. When farmers have faced a choice between investing in expensive machinery or employing cheap migrant labour to pick fruit, the result has been a prolonged period of under-investment in technology.
The problem of productivity is a hard one to address. The solutions are often ideological. Traditional left-wingers say the answer is to increase the minimum wage, invest in public services, and strengthen the unions. The logic goes that a happier employee works harder and shows more loyalty to their employer, although studies have shown that increasing wages often fails to increase productivity.
Those on the right argue that increasing the minimum wage makes it harder for companies, particularly smaller businesses, to employ new staff. As a small business owner myself, taking on a full-time employee is a major commitment. Getting it wrong could easily see my business go under.
Across the Atlantic employees of new media company Buzzfeed recently made headlines for attempting to unionise. In the face of multiple layoffs, 75% of those balloted still voted against. Why? As one insider told the media: “if we go out on strike, they will just fire us all and get in a team from India instead.”
Workers on the other side of the pond are far less protected than those in Europe, which is good for business, but bad for workers.
Brexit supporters such as Jacob Rees-Mogg and former Kent College pupil Johnathan Redwood have called for an end to the Working Time Directive to make us competitive with the US post Brexit.
This is the legislation that guarantees minimum holiday entitlement and maternity pay, protects us from discrimination, and gives us a bunch of basic rights many of us take for granted.
How then do we increase productivity without a bonfire of workers’ rights?
One way might be to follow the example set by Germany. German policy has strongly encouraged employee ownership of companies, the so-called John Lewis model.
Under this model, employees become company shareholders and in Germany, up to 50% of supervisory board seats are reserved for employees depending on the size of the company. This prevents fat cats awarding themselves huge pay rises denied to the rest of the workforce. It also motivates. Everyone has a vested interest in seeing the company succeed.
The path to greater productivity is actually rather simple. We train people with the right skills. We get them invested in their business and give them a say in how it’s run. Then crucially, we invest in technology which improves efficiency and creates higher quality jobs.
In Kent one of our biggest industries is agriculture. We are particularly at risk from the drop in migrant labour. People often ask why students or jobseekers don’t take over.
It’s pretty obvious really. Working the fields is hard, poorly paid, unremitting labour and people don’t want to do it. Without a radical change in thinking, we’re soon going to see fruit and veg rotting in the fields and farmers going out of business – while supermarkets stock their shelves full of imported goods.
But we can stop this happening. We need to reverse the decline in apprenticeships, currently overseen by Kent County Council. We must rapidly expand investment in technology by working alongside our excellent universities to issue grants and funding to tech and engineering firms, particularly those that promote employee ownership schemes.
Traditional hard left and hard right ideologies sometimes win on rhetoric, but they lack substance and don’t work in practice. It’s time for some sensible, level-headed thinking.
I leave you with a dream for Kent. Our booming agricultural sector becomes a partner for new self-started tech and engineering firms. Supported by graduates in relevant disciplines and a strong uptake in young technical apprenticeships, agri-tech firms build and service cutting-edge automated machinery that tackles the jobs left undone as the supply of cheap labour dries up.
As the industry develops, the falling price of machinery makes it available to smaller farms and businesses, growing our local economy. At the same time the number of well-paid jobs designing, assembling and maintaining the tech increases by the day.
The robots are coming and they’re going to save Kent.
Jobs. Money. Investment. Opportunities. Commercial success. If we make the right political decisions now and in the coming months, we can have it all.