The UK economy could receive a £100bn boost if businesses were to more widely adopt proven technologies like the cloud, e-purchasing, and mobile technology.
That is according to a report released today by the Confederation of British Industry (CBI), which argues failure to do this is largely responsible for the country’s sluggish productivity in recent decades.
It highlights how 69% of UK firms are at the lower end of the productivity scale, compared with 65% in France and 60% in Germany, while nearly 30% fewer had adopted cloud computing than Europe’s top performers in 2015.
“Too many firms are missing out on what’s right under their nose,” CBI director-general, Carolyn Fairbairn, said. “Failing to adopt the nuts and bolts technology of today is leaving a yawning gap in productivity.”
The CBI report reveals “striking” productivity differences between firms, with just 5% of the workforce employed by the high-fliers of UK business, leading to vast variations in wages and living standards.
In addition to providing a boost to the economy, it was found that a higher take-up of readily available technologies, along with better management practices, could reduce income inequality by 5%.
However, the findings show the proportion of businesses with e-purchasing, customer relationship management, and enterprise resource planning systems in the UK are still below the levels seen in Demark almost a decade ago.
It was also found that Britain has larger differences in management quality between its top and bottom firms than any other G7 country, with the scores of the best performing companies 1.7 times higher than the worst ones.
In addition, the research shows that the UK’s top 100 exporters account for approximately half of Britain’s export value, while in Germany they account for just 38%.
“Ultimately, getting better at diffusion of key technologies and innovation is one of the missing links in solving the UK’s productivity puzzle and should be made a national priority,” Fairbairn continued.
“The new industrial strategy is the perfect opportunity to address this blind spot in public policy. It must allocate funds to support businesses to adopt these readily available practices and technologies.”
The threat of cyber incidents is ranked as the number one concern for UK businesses this year, according to a survey of risk experts by Allianz.
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