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UK Leadership in Key Sectors

Leadership in some key areas such as higher education, finance, science and the creative industries will continue to have global impact. Other sectors will decline. New international collaborations with higher growth economies will be sought.

The UK will continue to suffer poor productivity over the next decade. In part, this is due to past mistakes. Fixed investment is a good indicator of low productivity growth, and over the last ten years, the UK’s average annual rate has been one of the lowest in the G7 at just over 16% of gross domestic product. But despite this, over the next ten years, the general expectation is that the country will continue to lead in four major areas – higher education, finance, science and the creative industries. These will all have global impact.

As a core part of this, the UK will seek international collaboration and new connections with the higher growth economies. Academically, the UK will continue to have leading global academic centres. Institutions like Oxford and Cambridge lead international rankings and so do not compete regionally – they will remain global institutions and operate at a different level, going beyond national issues and priorities, and tapping into wider talent pools and funding. Allied to academic research, key clusters will remain to the fore in scientific, but likely not innovation, leadership. Within this, the defence sector will continue to make a significant contribution. However, while the UK includes some of the most science-intensive regions in the world, turning leading research into high-value, good jobs within commercially focused innovation at scale, remains a cultural challenge; building a $1bn business rather than a $1tn business remains the ultimate ambition.

Other areas of leadership include the finance sector, where, despite the departure of some European- focused businesses post-Brexit, the City of London is expected to maintain its prominence. This is due to a relatively proactive regulatory mindset, a deep talent pool and lower trading costs. Lastly, expect significant growth in the creative industries. These look set to contribute over £150bn a year to the UK economy by 2030, and will add an extra one million jobs over the decade, whether in film, TV, music, design, fashion or architecture.

What does all this mean for those in transition? Given the increased focus on STEM and technical skills within the Armed Forces, this might suggest that transitioning Service personnel are well positioned to take advantage of the opportunities that are likely to emerge. But questions arise about whether the focus is on the appropriate growth sectors. This is particularly relevant for those without specific skills. “There is a concern that the training focus will remain on low growth sectors, which although significant in the past, are likely to decline.” A good example here would be the transport industry. Is it, for example, wise to encourage transitioning personnel to gain qualifications in professional driving skills at a time when there is a global shift to autonomous vehicles? Also, we heard that even those with skills are still hampered by a lack of industry experience and a clear understanding and experience of the recruitment process, so closer alignment with industry may be necessary.

Looking ahead, a pragmatic overview of the sectors that will have sustained growth and are likely to provide meaningful employment post- pandemic and post-Brexit, may be necessary to ensure the appropriate training investments are made. Furthermore, closer partnerships with growth sectors, through secondments, internships or indeed short-term placements will increase understanding of the needs and opportunities for all.

Example Implication: Training advice and modules will need to be reviewed to avoid a bias towards legacy industries and ensure that transitioners are being prepared for the future growth sectors.

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