Small firms 'can help close the UK's productivity gap'

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A focus on upskilling is needed to address the UK's productivty gap

Plans to deliver enhanced levels of productivity across the UK in the coming years have been supported by the Federation of Small Businesses (FSB).

Created by the government's Business, Innovation and Skills Select Committee, the report claimed that ensuring a reduction in the productivity gap between the UK and other nations will be integral to reducing the budget deficit, as well as delivering higher wages and living standards for all in the years to come.

FSB national policy director Mike Cherry noted that, for too long, UK productivity has trailed that of our international peers and it is a situation that businesses of all sizes must now look to address.

He stated: "The committee is right to press hard for a clear and distinctive roadmap as to how Britain will close our productivity gap. Small firms have an important part to play and our latest research shows steady improvement in productivity among our members.

"What is clear is these efforts require a long-term focus from both government and the private sector if the UK is to close the gap with our competitors."

The report pinpointed both a need for increased long-term investment in skills and training for the nation's workforce, as well as a commitment to the creation of enhanced competition within the business sector.

Potential upcoming policies will therefore focus on solving the problem of a lack of basic skills in the economy and the need for enhanced training for school leavers, to provide companies with new entrants into their field that are able to hit the ground running.

Measures to deliver an increased number of high-quality apprenticeships have therefore already started, while a move to increased parity between higher education and on-the-job learning is also taking place.

It is also imperative that the UK's entrepreneurial spirit is not stifled in the years ahead and the report therefore argues in favour of improved access to finance for new businesses, which will need to be high on the agenda of upcoming government policy proposals.

Furthermore, new Catapult Centres are to be rolled out across the nation in the coming months, with the aim of placing the UK at the forefront of the commercialisation of new technologies that offer global opportunities for growth.

Ensuring lasting investment in improved levels of infrastructure to ensure companies are able to leverage the best possible returns on investment and an increased focus on next-generation digital technologies will also form a key part of efforts to close the productivity gap, the committee and the FSB concluded.