How To Use Gva Data To Unpack Productivity In Your Local Economy
Hello everyone apologies for a slight delay in starting just a few technical issues thank you for bearing with us so um yes let me crack on but just wanted to welcome everyone to a busy webinars so we’re starting season 2 of our economic development series with a look at our new GBA data set and how it can be.
Used to better understand productivity at the local level I’d like to introduce myself I’m will Cookson and the Business Development Manager for.
Economic Development MZ and I’ll be hosting today’s webinar please feel free to ask any questions and there’s a box within your control panel should be on the right-hand side of your screen you can put any questions in there I’ll do my best to answer them at the end of the presentation so without.
Further ado let’s get going so today well first of all I’ll give you an overview of what we’re going to cover today so we’re going to looking at you’re looking at GPA what it is it’s more importantly we’ll be looking at how we’ve added TVA to our StrengthsFinder.
Methodology to look at clusters and the in how TVA can be looked at local level we’ll also be looking at how you TVA can be used to benchmark productivity and impact and also you looking at how it can be used to understand the trade-off between jobs and productivity to inform decision making so let’s get right back to basics GVA what is it TVA is essentially the value of goods and service minus the costs of production materials so if we use the Evergreen example of the widget the widget is produced.
By a factory then we have to minus the cost of the raw materials used to produce the widget and any energy that might have been purchased to fire up the machines to produce the MIT widget and then with once you’ve taken away those costs of production what you’re left with is the TVA generated by the company that is producing the widgets so roughly.
TVA should equal the money businesses have to distribute to investors ie their profits to workers and salaries and the government in their taxes.
TVA is all about measuring production and not distribution so it only tells us where the.
Value is being generated but not how it is being shared so why does it matter why is it such an important and useful measurement well it’s.
Not just jobs the UK has high unemployment but has been broadly stagnant in productivity for the past decade so traditionally we had an average annual rate of 2.3 percent GVA year-on-year for the decade preceding the recession in 2008 for the decade following the recession that’s dropped no point four percent so you can see that this is a reason that it’s been deemed to be an important measurement.
Because it’s about understanding our country’s productivity as well as internationally this sits behind policy initiatives like the government’s industrial strategy and this therefore an important measure to better understand as the economy also changes with the inch with automation with the challenges that may come with brexit ahead and also changes within our labour market and our local.
Economies with traditional industries that deliver delivering low productivity but may potentially high volume of jobs and newer industries such as lipstick of an example of.