Since the years of the financial crisis, low productivity growth has been present in the British economy. From 2010 to 2016, output per hour grew, on average, by just 0.2% a year. This was less than 2.5%, which was registered between 1950 and 2007. How can you get approved for the lowest-cost merchant services for your business? Just keep on reading and you’ll know.
Productivity Growth in Britain
The UK’s output per hour continues to be around a quarter behind competitors like France and Germany. This means it takes British workers 5 days to produce the results that others produce in 4 hours.
Businesses, specifically those that export, reached the highest level of their confidence for 2 years in the 2nd quarter of 2018. This is according to the latest Business Confidence Monitor from the Institute of Chartered Accountants in England and Wales.
UK firms’ sales have improved. Also, they now enjoy profit growth. This accounts for more capital investment and spending on R&D. Profits have grown by 4pc on average over the past 12 months. A similar growth rate is anticipated in the year ahead. This refers to all types of companies.
UK workers’ productivity growth registered in the last decade was the worst since the 1820s. The output level is still only barely above the point there was before the financial crisis.
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British Productivity Growth and Brexit
Staff turnover was another area of concern according to Michael Izza, who is the chief executive of the Institute of Chartered Accountants in England and Wales (ICAEW). The construction and business services sectors considered this a major problem.
The importance of productivity growth is the latest and most significant aspect of Britain’s economy. Currently, capital spending is improving. As a share of GDP, total investment has been a percentage point above its average since the crisis. Moreover, foreign firms are readily making investments.
When it comes to Brexit, reliable trade models speak of long-term losses from Brexit of up to 10% of GDP, depending on the way it’s conducted. As far as productivity is concerned, as for so much else, the way Brexit is conducted is the most crucial point.
In theory, investment could account for increased productivity enough to outweigh the effect of lost trade. Policymakers are step by step getting some things right. Government investment, which represents a share of GDP, may soon reach its highest sustained level for 40 years.
With all this in mind, turn to a reliable and experienced payment processor to get the best deal for your business. Focus on the current situation in the country and take the right steps so to move forward successfully.