A Pathway to Growth: How to Seize Opportunities for Innovation & Development
After a tumultuous few years, the UK economy now finds itself facing a challenging path ahead. BCG's Centre for Growth explores how the UK might rewrite this outlook to ensure sustainable and inclusive future growth.
Most assessments of the UK economy focus on its shortcomings. No doubt, there are quite a few. Our approach is different. We take a bottom-up approach, looking at practical steps that can set the UK onto a better track based on our learnings from working with businesses daily.
UK Has Many Strengths
By determining areas of strengths and advantage, looking at global megatrends and focusing on innovation and development, we identify nine key strengths of the UK economy. These are both sector-specific and broader cross-cutting factors.
Big Set of Ideas Required for Growth
Building on this analysis, we set out an initial path forward focused on a set of ideas that have the potential to drive growth and deliver both private and public benefits.
Key at the outset are:
· Energy Transition − focusing on areas such as clean hydrogen.
· Healthcare data/digital innovation − improving patient care and outcomes while spurring developments in the pharmaceutical, medical technology and biotechnology space.
· Artificial Intelligence (AI) − becoming a hub for AI innovation and development, which in turn also offers productivity benefits.
· FinTech − capitalising on opportunities in areas ranging from personal finance to crypto.
· Robotics/automation − exploring the huge potential of these areas, not least because the period of reliance on large pools of labour is coming to an end.
· Professional and business services − building on the bread and butter of UK economic advantage, in line with growing global demand.
Supply-side Reforms Likely for Innovation
Within these areas, we expect there are likely to be reforms, as changes of this nature are often fundamental to boosting innovation in growth. These include: infrastructure; housing; early years education; childcare; life-long learning; and training and tax simplification.
All this will require long-term, strategic approaches to key sectors and industries, underpinned by collaboration across the public and private sector.