Chapter 8: Human capital, skills and productivity
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This chapter evaluates the literature and empirical evidence on productivity performance across regions in the UK, with a focus on the contributions made by skills acquisition and utilisation, as well as by skilled migration. The chapter covers the literature and evidence on early life (pre-school) interventions, through to patterns in primary and secondary schooling, higher education, adult skills, and on-the-job training. Overall, the UK has a relatively high level of skills, and a labour force composition which has contributed positively to productivity growth both before and after the financial crisis. However, the UK does relatively badly in overall levels of job-related training and low- and middle-level skills, both of which have decreased over time. These disparities are among the most significant of any OECD country. This chapter seeks to highlight several gaps in our understanding of these disparities. First, there are gaps in the measurement of training, work experience, and adult skill levels, particularly at the regional level. Second, the determinants and effects of variations in non-cognitive (or softer) skills are not well understood. Third, several areas relating to adult skills are under-researched, particularly in the context of older and self-employed workers. Fourth, there is relatively little research, both in the academic and policy contexts, of the demand side for skills.

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