“The economic forecasts from the independent Office for Budget Responsibility show that low growth and weak productivity will persist until at least 2018. The forecasts also show that real wage growth over the next two years will be close to zero. Even this may prove optimistic, as continued uncertainty, difficult market conditions, and higher unemployment are likely to constrain firms ability or need to pay more.  The OBR is forecasting a slow recovery in productivity, but previous forecasts have been optimistic.

“We welcome the decision to invest £13m in the Sir Charlie Mayfield led initiative to help improve the quality of management in the UK. This is a crucial step forward in cracking the UK’s productivity puzzle which the Chancellor highlighted as a key area of focus and investment for the Government. However, attempts to improve workplace productivity will continue to be undermined without fundamental changes to skills policy, particularly in relation to apprenticeships, lifelong learning and adult skills provision.

“The decision to invest £1.8bn in Local Enterprise Partnerships is also welcome, given the need to provide more support for SMEs at a local level to help and encourage them to invest more in the skills of their workforce and enhance their management capability to boost employee engagement and productivity.”

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