Government must help firms flourish long term, says CBI

● Organisation says new kind of strategy needed amid fast technological progress

The UK Government must prioritise an industrial strategy to help UK firms succeed as new technology gains traction, the Confederation of British Industry is today urging.

It said a new kind of strategy is needed to help companies overtake competition, especially as more than a third of jobs might be displaced by automation and artificial intelligence in coming years.

Director-general Caroline Fairbairn said: “As uncertainty continues to bite on the UK economy, there has never been a more important time for the UK to unite behind a ‘leapfrog’ industrial strategy.

“The aim is to enable British firms to compete and win in the new technology age. It is also urgent. Change is coming at lightning speed and the world won’t wait for Britain.”

The CBI also said it surveyed about 400 firms, finding that 82 per cent believe the main pillars of a new industrial strategy must be people, infrastructure and innovation. Additionally, 89 per cent think a modern industrial strategy could be a key opportunity to improve living standards across the UK by 2030.

Fairbairn added: “We can’t afford to let Brexit distract from the long-term action that is so badly needed. What’s at stake is the UK’S future in a global economy redefined by artificial intelligence and automation.

“Brexit must not be allowed to crowd this out.”

The CBI said uncertainty is constraining investment with key concerns including what post-brexit trade will look like.

Olly Benzecry, UK and Ireland managing director at Accenture, said: “The industrial strategy presents an opportunityforgovernmentto take on board, and implement, some of the bold ideas being recommended by industry, such as those laid out in the recent Made Smarter Review.

“This review highlighted how digital technologies, such as artificial intelligence, augmented reality and robotics have huge potential to bring about economic growth, increased productivity and jobs.”

The CBI said successes would include boosting the UK’S poor productivity record and fostering a fairer society. It also called for a new style of partnership between government and business, an independent industrial strategy office and a commission on artificial intelligence.

It comes as a separate survey published today found that UK business output growth fell to a 21-month low in October.

Accountant and business adviser BDO said its output index had dropped to 99.06, from 99.95 in September, with growth for both manufacturing and services having fallen below the long-term trend.

BDO partner Peter Hemington said: “Britain’s productivity puzzle has become more acute than ever.

“The government must address the low levels of productivity now by taking advantage of cheap borrowing costs and invest in transport and digital infrastructure, training and skills to protect future economic growth.”