I think the road ahead will be tough. But the government focus should be to enable small business and encourage entrepreneurship and access to “seed capital.”

If we get this right, the rest of the things will fall in place. This may be a generalisation, but an “economy around entrepreneurs” is our best bet.

One of the things I learned from business leaders on a recent visit to the UK is that they are facing another potential dip due to the looming exit of the baby boomers. These people who are now on the brink of retirement will take years of corporate knowledge with them leaving potential gaps that will stall or hinder organization’s abilities to serve their clients across the globe. I am currently working with the Canadian government on knowledge capture and knowledge transfer in advance of this huge drain of expertise. It’s time the UK looked to this huge challenge and took steps now to mitigate the risks to corporate or government survival.

You make some bold assertions to hang your advice on, but only one piece of evidence: productivity, and even this is subject to issues of measurement/valuation. I would appreciate seeing more of the evidence: for example for the 2% MNCs driving economic growth. Taking up your advice would have far-reaching consequences, and I would like to be sure the evidence base is sound before proceeding. Old-fashioned perhaps, but we might then be able to better track the consequences of our decisions if we have a sound foundation of understanding on which to build.

Excellent analysis. Productivity improvement would probably be the primary contributor to growth. Besides productivity enhancement tools and skills imparted through education and training, the workforce (both blue and white collar) would need the motivation and drive to migrate to higher levels of productivity. Focus on education would be of great import in this process. UK needs more people in the working group who have earnings as well as an appetite to spend. This is where a friendly immigration policy may help.

There is also a strong case to increase the retirement age in all sectors. With good healthcare support, there is no reason to be apprehensive of productivity decline with increase in the retirement age of skilled and unskilled workforce.

The EU will never match the USA for productivity because of outdated work practises based on a feudal system and employee benefits that increase business costs. There is poor flexibility in labour and European holidays are four times greater than that of the USA.

The USA embraces new technology much faster than Europe.

This does not mean that Europe could not change, it could, but I see no will on the part of politicians to tackle change. In fact I see more regulation and red tape not less.

Why use only Western productivity comparisons? In a global economy, you need to include at least BRIC, and then ask what is the UK doing wrong, apart from humouring feral banks?

Interesting suggestions, however, the actuarial and evidential basis will need to be carefully analysed. Hypothecation of sequestered assets and resources in manners such as are outlined here hold some obvious attractions and pose some valid concerns. If a further result of the banking crisis is to strip out further capacity for resilience, it behooves us to consider such strategic shifts very carefully indeed before making irreversible mistakes. We definitely need to learn from our recent mistakes and get things right from here on.

1. Productivity – productivity in UK has always lagged Europe and the US, the question is how is productivity measured and why is productivity lower in UK than in other countries? Is it a result of general attitudes in the workplace, the weakness of management because of the ‘us and them’ approach that appears to permeate industry and commerce, the considerable gap between the remuneration of those at the higher levels and those at the coal-face, the influence of trades unions, or, is it the weakness of the public sector that is less productive, efficient, and effective as the private sector?

2. Multinationals – are getting fewer and fewer as British companies are bought out and become foreign owned and then the parent company seeks to shift its head office, manufacturing plant, distribution centres, and/or call centres to countries of lower labour costs. Cadbury, bought by the US food giant Kraft, is an example of plant closure followed by re-location. There is an urgent need to identify new areas of industry and commerce and teach and train younger people to move into those sectors.

3. Transport and Energy – this is a case of failing to invest for the future during the 1980s and 1990s to improve transport systems and sources of energy; and, selling off the rail network and franchises creating the most expensive and often inefficient and badly managed rail network in the world. Our energy companies are now foreign owned by German, French, and Spanish energy utility companies.

4. Innovation – demands serious investment and most companies in UK and the public sector have not invested for the longer term for decades. If the state education and training system does not encourage and support sound policies that support, for example, electrical, electronic, electrotechnical, aeronautical and mechanical engineering, and biosciences then how can one concentrate on those sectors?

5. Regional Pay and Responsibility – already happens in the private sector, trying to push for different pay banding in different parts of the country is most likely to be fought against tooth and nail by the public sector employees and their unions.

6. Towns and Cities – England is already the most densely populated nation in Europe and attempting to expand companies in and around London would be a total disaster. What needs to happen is for companies to re-locate up and down the country creating employment especially in areas of high unemployment.

7. Ageism in UK PLC - companies and organizations should adopt a flexible approach by employing a cross-section of ages for the fundamental reason they have a cross-section of ages among their customers. Perhaps, there should be older workers to provide experience, mentoring and knowledge; middle-aged employees to provide stability and for management succession; and, younger people to provide fresh thinking and new ideas. And, promotion should be based on knowledge and ability and not on time served.

In your article you make various references to the quality of management and the workforce within the UK. In this respect, the UK in recent years has established an increasing inhibitor, namely the recruitment and selection process. For example, in the IT sector 15 to 20 years ago it was possible to apply and be selected for a role where there was a 60% to 50% fit. In today’s risk-averse environment this is approaching 100% (if not more!). While on the face of it this might appear to be the result of an improved selection process, the net effect is possibly negative and damaging simply as the process fails to offer an growth potential at an individual level. In practical terms, it implies that you can only apply for your existing role! The individual lacks motivation, growth, and personal development opportunities and is simply being asked to ‘turn the handle.’ The organisation gets exactly what they asked for, namely, an individual who can do the job but is unlikely to respond to a changing environment simply because these individuals may have been ‘filtered out’ during a process that was designed to find the ideal candidate.

The dynamic growth period for IT in the UK during the 1980s and 90s was characterised by a selection process that offered and encouraged growth in the individual combined with high-levels of motivation. The direct result was to foster corporate growth simply as “we’re only as good an the people we employ.”

It’s interesting to note the emphasis (rightly placed) on education and training in this summary: “Improving the quality of management and the skills of employees... Investments in research... Education and health care are more than public-sector cost centers... UK should add capacity to existing universities and build new ones...”

The question is whether these recommendations will be heeded. As things stand, and following the UK disinvestment in higher education, it seems unlikely.