UK productivity is lagging well behind other members of the G7, despite record levels of employment. By rights, more people in work should mean increased productivity but it doesn’t. We need to understand why.
To survive on the global stage and increase productivity, the UK must embrace the automation revolution. However, technology by itself is just one side of the coin. People will be the difference between the UK experiencing a digital shock or a digital revolution.
Worryingly, the UK does not have a strong record when it comes to investing in new skills. A 2017 CIPD report found that UK employers spend less on training than other major EU economies and less than the EU average, and the gap has widened since 2005.
This complacency may well stem from a culture of ‘survival over change’ that has existed within the UK economy since the global financial crisis. Some ten years on, we are now at a crossroads. The internet and email transformed the workplace, but now the next wave of change is upon us with automation and digitisation sweeping our offices like never before.
I recently spoke to a globally renowned company that ran an artificial intelligence (AI) programme to produce financial reporting and forecasting, a function previously delivered manually. The output of this exercise was more accurate forecasting and a huge reduction in people hours. The use of AI accounted for two people’s work over the course of two days compared to 800 employees taking a month to do the same analysis previously. This is clearly a revolution happening now in my profession, management accountancy.
This stark example might lead you to think that an automation revolution will mean severe job losses, but this appears not to be the case, at least so far. Technology is not a replacement but an augmentation of human capability. However, workers are failing to recognise, let alone grasp, what this new reality will look like and what it will mean for them.
When we asked workers about their attitudes towards automation and technological innovation in the workplace, only 38% thought a portion of their roles will be automated and 26% hadn’t even considered the impact of automation on their jobs. This is alarming and is compounded by the simultaneous complacency about the need to learn new skills. One in four workers admitted to not participating in any in-work learning in the past year and nearly two in five workers believe they do not need to improve their skills.
To my mind, as a management accountant, understanding what workers are doing in the workplace is critical. We know that technology and automation make the difference to productivity and could give the economy a crucial boost. Without augmenting workers’ skills with new technologies, real wages and economic growth could stagnate and adversely affect living standards. This is why learning in the workplace is so important. It is the easily overlooked problems that could create a lost decade of business performance, if left unchecked.
It is essential to adopt a mindset of ‘learning, unlearning and re-learning’ to ensure you have the skills needed to keep up with the pace of change. In practice, this means workers no longer just need to learn technical processes but expand their skillsets in areas technology cannot address such as improving judgement, leadership, empathy and creativity.
Employees need to be proactive and take hold of their careers. With the country on the cusp of leaving the EU, none of us can afford to get left behind. Empowered use of technology will help us to forge our way. And it could very well be a significant contributor to redressing the productivity puzzle which has beset the UK over the past ten years.
Playing catch up is exhausting. We need to be at the front of the pack. Having the right attitude to embracing new skills and technology to transform our businesses and people’s careers will make a big difference to driving opportunity, economic growth and prosperity.
Andrew Harding is chief executive, management accounting, Association of International Certified Professional Accountants
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