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Northern Ireland is poorest performing UK region for productivity

Researchers from Queen’s University Belfast have found that Northern Ireland is the poorest performing UK region for productivity, with a productivity gap of 17% to the UK level.

The findings are from the ‘Northern Ireland Productivity Dashboard 2022’, which demonstrates Northern Ireland’s performance across 18 different drivers of productivity, relative to the UK average and other regions, and over time. It highlights where barriers to productivity growth exist, their severity, and whether progress is being made to address them.

Productivity measures the value of output produced in the economy for a given amount of work. It is crucial for the local economy. Higher productivity means higher wages and better living standards. It can also mean more money available to invest in public services.

The Dashboard has been created by Dr David Jordan and Professor John Turner, on behalf of the Northern Ireland Productivity Forum, which is based at Queen’s Management School. The Forum is part of The Productivity Institute, a UK-wide organisation that works across academia, business and policy, to better understand, measure and enable productivity across the UK.

The Dashboard demonstrates the weaknesses Northern Ireland possesses across a number of key areas: 11 of the 18 drivers are below the UK average, with only 2 better, and the remaining 5 either equal to the UK average, or below, but above the UK median.

Key findings:

  • The number of individuals with a third-level education is now almost equal to the UK average, following a substantial recent increase.
  • The number of individuals with no or low skills has continued to fall, but an attainment gap relative to other UK regions persists.
  • Gigabit-capable internet services are the best in the UK, reflecting recent investment.
  • Employer provided training is low compared to other UK regions.
  • Foreign direct investment (FDI) per job is lower than the UK average.
  • Northern Ireland also lags behind the Republic of Ireland, where productivity is around 29% higher than the UK average.

Speaking about the findings, Dr David Jordan said: “Low productivity is the biggest economic challenge facing Northern Ireland. The aim of this new dashboard is to bring together data from a variety of sources, to show how Northern Ireland performs across the different drivers of productivity. It demonstrates the scale of the challenge, with improvements needed across the majority of drivers if we are to raise productivity in the local economy.

Professor John Turner added: “The Northern Ireland Productivity Dashboard shows the weak state of the Northern Ireland economy. It also reveals what Northern Ireland needs to work on if it is to have a prosperous future. None of this, however, will be possible without a stable government in Stormont.”

Professor Bart van Ark, Managing Director of The Productivity Institute said: “The productivity performance across regions and devolved nations is at the core of the UK’s productivity slowdown and our eight Regional Productivity Forums were formed to examine the local dynamics. This dashboard will help to point to productivity issues relating to Northern Ireland which have not always been captured and allow for better comparison with the rest of the UK. Boosting productivity across English regions and the devolved nations is key to boosting economic growth and shared prosperity across the whole country.”

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