Mind the capital gap: British citizens are poorer because UK workers are denied capital

4 comments

1. From the point of view of an international business though, why give British workers your most expensive productivity tools if past stats are telling you they’ll do 10 – 15% less with them than American or French workers? From the business perspective you’re gambling by investing in the British worker whose past performance on paper is lower.

   It makes intuitive sense that with the same level of upgrades to equipment, British workers (who have similar education levels, working hours, employment rights) *might* do just as well as peers elsewhere, but you have empirical evidence that German or French workers are likely to do better.

2. Or is the exact opposite true: when labour is cheap because wages are suppressed (for example by mass immigration), it becomes relatively less efficient to invest capital in equipment to get more efficient use out of your labour.

3. ‘Compared to workers in the US, Germany, France, and the Netherlands, people in the UK have access to a third less capital per hour worked. Less software. Fewer machines. Outdated systems. Insufficient training. Too little R&D and organisational capacity. The result? Lower productivity, lower wages, lower living standards.’

   That’s spot on, although there’s another side to it. The middle-management inefficiencies in this country are truly staggering and it’s a legal fkn nightmare to fire individuals that are either ‘blockages’ or just very shit at their job.

4. The government doesn’t want you to have capital. They can’t tax that as much

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