Ending stagnation

A New Economic Strategy for Britain

The UK has great strengths, but is a decade and a half into a period of stagnation. The toxic combination of slow growth and high inequality was straining the living standards of low- and middle-income Britain well before the cost of living crisis struck. It is time to embark on a new path. This, the … Continued

Talking trade-offs

Deliberations on a higher-productivity future in the Birmingham and Greater Manchester urban areas


The cities of Manchester and Birmingham may have illustrious economic histories, but today both underperform the national average on a number of key economic measures. This is especially the case when it comes to productivity growth. Accelerating productivity in each city region would require radical reforms trade-offs to be made, but these changes cannot be … Continued

In place of centralisation

A devolution deal for London, Greater Manchester, and the West Midlands

Higher economic growth in the UK requires big changes. Tackling the persistent underperformance of Manchester and Birmingham, as well as the stagnation of London’s economy since the financial crisis, are some of the changes needed to improve national prosperity. One of the reasons for their poor performance is the British state’s internationally exceptional level of … Continued

Watt’s the plan?

Renewing utilities regulation for the net zero era


The UK has major infrastructure challenges ahead. We need to decarbonise our energy and transport systems, adapt to a changing climate (temperature extremes, drought and heavier rain), keep up with our insatiable demand for data, and accept that we are finally reaching the limits of our Victorian-built sewers and railways. This requires a huge increase … Continued

Finance for the future

Practical solutions for the UK Government to mobilise private investment for economic, environmental and social priorities


The UK Government has an opportunity to mobilise far greater amounts of private investment for public policy priorities than is the case now. Blended finance, deployed well, offers a tried and tested pathway for public and private investors, with different outcome, risk and return expectations, to work effectively together. This paper provides examples from the … Continued

How higher education can boost people-powered growth

Steering economic change


Higher education brings benefits to individuals, to the wider economy and to society. From America’s post War GI Bill to the transformation of Korea, more people getting more education is one of the most powerful tools which a government has to transform its economy. The OECD estimate that every extra year of education boosts long … Continued

Learning to grow

How to situate a skills strategy in an economic strategy


Investing in human capital is a crucial aspect of building an economy that is both more productive and fairer, and any growth strategy must incorporate an agenda for increasing human capital and workforce skills within that. So how should we approach the task of developing a skills strategy that complements a broader economic strategy? In … Continued

Built to last

Towards a sustainable macroeconomic policy framework for the UK


This paper, part of the Economy 2030 Inquiry, tackles the key question of how to futureproof the UK’s macroeconomic policy framework. Looking beyond the immediate policy challenge of high inflation, it focuses on whether the current framework – largely set during the calmer economic times of the 1990s – is still fit for purpose. Since … Continued

Ready for change

How and why to make the UK economy more dynamic


Britain’s productivity shortfall is its foundational economic problem. Debate about this gap and how to fix it typically focus on raising productivity of existing firms, via two routes. First, innovation: investment, R&D and patenting as ways to inject new ideas into pre-existing firms. Second, diffusion: the cascading of those new technologies and improved management practices … Continued

From safety net to springboard

Designing an unemployment insurance scheme to protect living standards and boost economic dynamism


Losing your job in Britain is a very risky business. Low levels of out-of-work benefits are rarely an adequate safety net for those who experience job loss, and workers in the UK who move out of work are at greater risk of experiencing a large income loss than those in most other OECD countries. Some … Continued

A tale of two cities (part 2)

A plausible strategy for productivity growth in Greater Manchester and beyond


Few would disagree that the UK has a significant productivity problem, or fail to recognise that the poor performance of the nation’s largest cities outside the capital contribute to that situation. As the Economy 2030 Inquiry has made clear, the productivity of our largest cities lags the UK average, bucking the global trend for bigger … Continued

A tale of two cities (part 1)

A plausible strategy for productivity growth in Birmingham and beyond


After the success of the Commonwealth games in 2022, Birmingham is now in the news for the wrong reasons. Financial difficulties facing the City Council culminated in a formal declaration on 5 September 2023 that Britain’s largest local authority was, in effect, bankrupt. But the understandable short-term focus on the council’s financial woes must not … Continued

Putting good work on the table

Reforming labour market institutions to improve pay and conditions


The UK needs stronger labour market institutions Decent work is a pre-requisite for delivering shared prosperity and improving the lives of the country’s 34-million-strong workforce. In this context, the UK labour market has a number of strengths – from high employment to a national minimum wage that is now among the highest in the world. … Continued

Sharing the benefits

Can Britain secure broadly shared prosperity?


The UK has been living through a period of relative decline that has proved toxic for those on low-to-middle incomes. Against that backdrop, this report examines whether there is still a plausible path to steadily rising shared prosperity and, if so, what does it look like. It does this as part of the Economy 2030 … Continued

Tax planning

How to match higher taxes with better taxes


The UK’s tax take is rising, and is likely to stay high, but the system is not improving. The UK needs a tax strategy to support its economic strategy, using the tax system to boost shared growth. This paper, part of the Economy 2030 Inquiry, describes what a good tax strategy would look like and … Continued

Beyond Boosterism

Realigning the policy ecosystem to unleash private investment for sustainable growth


The UK is a low investment nation. Low business investment is a big driver of this. Low investment is one reason behind the UK’s weak productivity growth, which in turn is the main reason behind the stagnation in UK living standards. Policy makers understand this and have made attempts to fix it. This paper, part … Continued

Trading Up

The role of the post-Brexit trade approach in the UK’s economic strategy


After nearly half a century of EU membership, Britain needs a trade strategy. The stakes are high: such a strategy shapes what families and firms buy from abroad, and what gets produced domestically; influences our jobs, productivity levels and, ultimately, living standards; and contributes a major plank of Britain’s international policy at a time of … Continued

Where the rubber hits the road

Reforming vehicle taxes


This briefing note examines the future of motoring taxes, which need extensive reform given the necessary and welcome rise of electric vehicles. We detail a suite of policies that will protect revenues and lower income households, reduce congestion, and facilitate the transition to zero-carbon motoring. 

Lessons from successful ‘turnaround’ cities for the UK

Navigating Economic Change

In this essay, part of our Navigating Economic Change series, the authors explore how cities can reverse long-term economic underperformance and move towards a new trajectory, looking at seven cities across five countries that have faced severe economic shocks but managed to break away from the resulting cycles of decline and transition to a more successful development path.

Low Pay Britain 2023

Improving low-paid work through higher minimum standards


After a decade and a half of relative economic decline, Britain needs a new economic strategy. And good work must be at its heart – an explicit goal, not a hoped-for by-product of growth. This is a necessary precondition for a strategy that offers a credible promise of shared prosperity in the years ahead, strengthening … Continued

Institutional reform for Inclusive Growth

Lessons from Germany and Sweden


In this essay, part of our Navigating Economic Change series, Anke Hassel and Kathleen Thelen explore strategies for mitigating some of the income, job and educational inequalities that rich democracies are currently confronting as a result of technological change and the growing gap between winners and losers in the new knowledge economy.

Cutting the cuts

How the public sector can play its part in ending the UK’s low-investment rut


Britain is a low investment nation. Worse, it has now been one for decades. Total investment as a share of GDP has consistently been below the average of other rich countries for decades. This century, the UK has consistently (in all but two years) been in the bottom 10 per cent of countries in the … Continued

Open for business?

UK trade performance since leaving the EU


The overwhelming consensus was that Brexit – which raised trade barriers with the EU – would make the UK less open, less competitive and reduce the size of the economy. The fact that the UK is the only G7 country yet to regain its pandemic level of GDP seemed to corroborate these gloomy predictions. But … Continued

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