Budget 2025: Why productivity must be the UK’s top priority
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Manufacturing
Dr Graham Hoare OBE responds to the Chancellor’s Budget by calling for a united approach to tackle the UK’s productivity challenge and build long-term confidence for industry growth.
At the heart of today’s Budget lies a stark reality: the UK’s productivity challenge.
Growth forecasts have been downgraded due to weaker underlying productivity. A 0.3% shortfall may sound marginal, but in practice it means a £16 billion gap in the public finances. A gap the Chancellor has had to fill.
Tackling this challenge demands sustained collaboration between academia, industry, and government to accelerate skills development, drive technology adoption, and build capability across every sector. The Modern Industrial Strategy is essential for creating the long-term confidence businesses need to invest, innovate, and grow.
The Budget rightly spotlighted the UK’s advanced manufacturing strengths – from automotive to defence, nuclear to digital – and reaffirmed the need to invest in skills and enable businesses to both start up and scale up.
But now, more than ever, we must be ambitious. Productivity is not just a challenge to overcome; it is the lever that will define the UK’s global competitiveness for decades to come.
Dr Graham Hoare, Chief Executive Officer - MTC