WBS forum to explore UK's productivity puzzle

Academics from Warwick Business School are set to address the UK's productivity challenges during a National Productivity Week event tomorrow.

The WBS-hosted event, led by Nigel Driffield, Professor of International Business, will bring together business leaders, policymakers, and academics to explore key issues such as AI adoption, sustainability, wellbeing, investment, and devolution.

Only by addressing this multi-faceted nature of productivity can the UK chart a path towards sustained productivity growth, the conference will hear.  

In particular, the UK needs greater collaboration between national and regional authorities to bring a more systemic approach to pro-productivity policies.

"National strategy can be no more than a framework for local or regional strategies, backed up by devolution deals,” said Professor Driffield, who is also the Midlands Lead for The Productivity Institute.

“The Mayors of England’s combined local authorities, as well the devolved governments in Wales, Scotland and Northern Ireland, should have more agency, but also responsibility, to deliver a joined-up approach to skills, business support, inward investment, supply chains, and identifying place-based and sector-based business clusters.”

Mental health and wellbeing

The WBS conference – one of a series of regional events during National Productivity Week and the second held by WBS – will also focus on the impact of workplace mental health on productivity, with a joint presentation by Dr Vicki Belt and Dr Maria Wishart from the School’s Enterprise Research Centre (ERC).

Their research project, funded by the Economic and Social Research Council, has investigated the relationship between employee mental health and productivity over the past five years. Analysing data from nearly 10,000 companies in the Midlands, and employing in-depth interviews with employees and managers, it has revealed a number of issues.  

“One major concern is ‘presenteeism’ – employees working while ill – which hasn’t gone away and has increased since the pandemic,” said Vicki Belt, Deputy Director of Impact and Engagement at the ERC.

Another is the ‘attitude-action gap’. “When you ask employers, they recognise the importance of mental health in the workplace and their responsibility to support it,” said Dr Belt.

“But when you ask them what they are actually doing about it, the answers are often less positive.”

Mental health training for line managers is key, according to Dr Belt. Interdisciplinary research carried out under the ERC-led research programme has found a strong association between such training and improved staff recruitment and retention, better customer service, and lower levels of long-term sickness absence due to mental health issues.

“We definitely need more training, not only for line managers, but also the senior managers driving company policy,” Dr Belt said.

“Greater awareness and evidence-based strategies around employee mental health are important, particularly as the wellbeing of the workforce is so important to business productivity.”

The twin transition

In addition to the presentation on mental health and wellbeing, the conference tomorrow will also seek to understand how the ‘twin transitions’ of digital transformation and net zero are contributing to productivity improvement.

Under the leadership of Stephen Roper, Director of the ERC and Professor of Enterprise, an international analysis is being carried out on the links between digital adoption and moves towards net zero, as well as a qualitative study on how digital technologies are enabling net zero initiatives in the construction sector.

Professor Roper said: "Digital technologies can help firms better understand the impact of climate change on their business and operations and help them implement climate strategies.

“So, supporting digital adoption in firms can help support the climate response."

However, the qualitative analysis has revealed that firms are at varying stages in their net zero and digital journeys, often treating these initiatives as separate issues.

“We need to encourage firms to see digital and net zero decisions as inter-related and encourage more holistic strategies,” Professor Roper said.

The WBS conference will be one of the closing events of National Productivity Week organised by The Productivity Institute (TPI), a public-funded research body involving a number of academic and policy institutions including the University of Warwick. WBS London at The Shard held the opening event of the week on Monday.  

TPI was established in 2020 to address the UK’s long-held productivity challenges that have been prevalent for almost two decades.

Between 2009 and 2019, Britain’s productivity growth rate was the second slowest in the G7. In 2024 output per hour worked was about 10 per cent below the average for France and Germany and almost 20 per cent below the level in the United States.

Nigel Driffield is Professor of International Business and Deputy Pro Vice Chancellor for Regional Engagement. He is also Midlands Lead for The Productivity Institute and teaches on the Undergraduate programme.

Stephen Roper is Professor of Enterprise and Director of the Enterprise Research Centre.

Vicki Belt is Deputy Director of Impact and Engagement at Warwick Business School’s Enterprise Research Centre.

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