Jeremy Peat, Visiting Professor, IPPI, University of Strathclyde. First appeared on IPPI Blog.
Despite the Brexit vote economic life goes on, and more than ever we need to work through how Scotland’s economic performance can be enhanced. Nobody knows precisely what life beyond the referendum vote will actually mean for the UK; let alone what lies ahead for Scotland. However, in order to minimise the risks within our economy, and maximise the prospects for prosperity, businesses in Scotland must be innovative and competitive. As set out in my IPPI Policy Brief some months back that implies a real focus on improving productivity across our economy.
Apparently ‘productivity’ is not a regular feature of debate in business circles. But it should be. It simply means output per unit of input – how efficient we are in producing goods and services. Overall growth in our economy, the increase in Gross Domestic Product, comes from increased productivity plus population growth. But increased affluence, increased output per head of the population, relates to productivity growth alone.