Introduction
For years, there has been debate around the nature of the UK’s ‘productivity puzzle’[1][2]. It has been central to the levelling up project[3], to the work of Transport for the North[4], and it is one of the key challenges facing the North East.
But it would be wrong to view productivity as a standalone problem to be solved, and an important connection to make is between productivity growth and inclusive growth. There is a growing body of thought and research which links inclusive growth with improving productivity, but they still tend to be considered independently.
This spotlight page examines inclusive productivity, covering at a high level the different ways in which inclusive productivity growth can be understood and why both productivity and inclusivity are key elements of a well-functioning economy. It then discusses what the evidence tells us about how these two concepts can mutually support one another.
It suggests that increasing regional living standards and employment prospects through improving productivity is one way of working towards both goals simultaneously, although there are potential trade-offs that need to be mitigated through any inclusive growth strategy too.
- ^ Office for Budget Responsibility (2012) The productivity puzzle. Available here.
- ^ Office for National Statistics (2015) What is the priductivity puzzle? Available here.
- ^ UK Government (2022) Levelling Up the United Kingdom. Available here.
- ^ Transport for the North (2023) Economic scenarios for the Northern Powerhouse Independent Economic Review. Available here.