Published on 31 January 2022
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Productivity slowdown in the East of England

Over time productivity growth in the East of England has not increased in line with other UK regions bringing real issues of inequality. A strong place-based approach is needed to boost productivity and level up.

Despite a relatively high level of productivity, the East of England showed a poor record of raising output per working hour compared to other main regions and devolved nations in the UK over the past decade. Business leaders, policymakers, and academics from across East Anglia have worked in conjunction with The Productivity Institute, a nation-wide research body on productivity in the UK, and the Bennett Institute for Public Policy at the University of Cambridge, to explore what productivity means for commerce, workers and communities; how it is measured, and how it truly contributes to increased living standards and wellbeing.  

The findings, detailed in a new Insights Paper produced by the East Anglia Regional Productivity Forum, highlight the productivity challenges faced by East Anglia and the wider East of England.  

At an aggregate level, measured in terms of output per hour worked, productivity in the East of England in 2019 ranked fourth after London, the South-East and Scotland. Output per hour in East Anglia was about 8 percent below the UK average. But productivity hardly increased over the past decade. In East Anglia productivity increased at only two percent over the entire period, which is only half of the UK growth rate. When looking more closely, there are places which are falling behind, as well as those that are steaming ahead. Even within places performing strongly, such as Cambridge, there are real issues of inequality. 

In recognition of its geographical diversity, the Forum calls for a strongly place-based approach to the region’s productivity challenges. This will include, for example, the effect from the tensions between different land uses, the management of water and the importance of biodiversity on agricultural productivity in the Fens, the impact of climate change on productivity along the coastline of the East of England, and the role of Greater Cambridge as a source of comparative advantage in the knowledge economy. The Forum will also address concerns about the piecemeal nature of the current governance structure of East Anglia on how it affects productivity.  

The study is part of a nationwide effort to boost productivity and level up all areas and regions across the UK.  

“The work of the East Anglia Regional Productivity Forum has been essential in drawing together expertise from across the region’s private, public and third sector organisations to map out the opportunities, risks, and linkages between the different functional economies in the region.  We recognise that our region is at the forefront of both the challenges and opportunities from climate change. As we move into the next phase of work, we are keen that the work of the Forum can bring forward proposals that can allow us to address the former and maximise the latter and drive up both productivity performance and the quality of life for all who live and work here.” says Alex Plant, Chair of the East Anglia Productivity Forum and Director of Strategy & Regulation at Anglian Water. 

According to The Productivity Institute, the United Kingdom (UK) has suffered an extreme version of the ‘productivity puzzle’ threatening economic growth and shared prosperity across the nation. The long-term underperformance of productivity across regions and devolved nations is at the core of the UK’s productivity slowdown. 

The Bennett Institute for Public Policy at the University of Cambridge is home to the East Anglia Regional Productivity Forum and the Cambridge hub of the UK’s Productivity Institute.  

“By bringing together the academic community with representatives from the worlds of business and the public sector, the East Anglia Regional Productivity Forum provides a space where these issues cannot only be identified and examined but can also see shared solutions being developed and tested,” says the Forum’s lead, Owen Garling, Knowledge Transfer Facilitator at the Bennett Institute for Public Policy, University of Cambridge. 

Insights Paper

Exec Summary 

The views and opinions expressed in this post are those of the author(s) and not necessarily those of the Bennett Institute for Public Policy.

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