Investment in skills will improve productivity, says CIPD

The Government needs to invest more in vocational and further education if employers are going to see real increases in productivity, according to the CIPD.

The Government needs to invest more in vocational and further education if employers are going to see real increases in productivity, according to the CIPD.

The HR membership body called for the government to prioritise workforce skills development in next week’s Budget, and advised businesses to invest more in development and adopt “smarter” working practices to solve Britain’s dire productivity problem.​

Latest figures released by the according to the Office for National Statistics (ONS), reveal that workers’ output per hour had gone up by 0.3 per cent in the first quarter of 2015 compared with the previous quarter, which is the fastest rate of growth since the start of 2012. Although output per hour grew in the services sector, productivity across the whole economy fell slightly.​

CIPD chief executive Peter Cheese said: “Our flexible labour market’s ability to create jobs has exceeded expectations, but our report shows that increasing headcount is now the most common way that businesses respond to increasing demand.We need a shift in focus towards increasing the value generated by the workforce and how work is organised.”

According to the CIPD’s report, Productivity: getting the best out of people, only 41% of businesses consider increasing productivity to be a current priority, while one-third do not have any measures of productivity in place.

Chris Jones, Chief Executive of City & Guilds, the global leader in skills development, said: “The figures are promising, but our productivity still lags behind other countries, hurting our economy. We’ve enjoyed sustained job creation over the last few months, but without increased worker output we’ll lose the ground we’ve gained.

“We’ll never make a full recovery unless we see more investment in helping people to up-skill throughout their careers. Other countries understand that training shouldn’t stop once someone has a job, so they invest accordingly. It allows them to be much more agile in responding to changes in the workplace. We can’t continue to compete in the global economy if we don’t encourage the same attitude.

“We cannot be complacent just because this quarter saw a small rise in productivity. With the Budget on the way, it’s time for the Chancellor to support employers, education providers and policymakers to work together to remove the obstacles to on,” added Jones.

Mary.Isokariari

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