Framework for Growth

We believe that the new UK Government has an opportunity to develop an industrial policy that helps establish a new model of inclusive growth. Our Framework for Growth sets out business leaders’ priorities, and provides economic analysis to assess the potential impact.

A renewed industrial strategy for the UK will need to be informed by an understanding of which interventions could have the biggest positive impact on the economy as a whole.

To help contribute to this discussion, PwC has developed the Framework for Growth, which groups the various levers for driving economic growth and productivity into 10 core components. 

Through our research, including in-depth interviews with over 60 business leaders and a survey of 1,200 business decision makers, we’ve identified which of these components business leaders, across different sectors, believe would most support them in breaking down the barriers to growth and productivity that they face. 

Where possible, we have then sought to complement this insight with new economic analysis, for six out of the 10 components, to provide an indication of the potential impact that improving the UK’s performance in certain specific, measurable areas could have on the size of different sectors.  


Introduction to the Framework for Growth research

Andy Haldane, Advisor to PwC and formerly Chief Economist at the Bank of England and a member of the Bank's Monetary Policy Committee

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Explore the insights from our research and economic analysis

Below you can interrogate the research and economic modelling that underpin PwC’s Framework for Growth. In the Research explorer you can begin by simply choosing one of the 10 components below. The most effected sectors will be highlighted underneath. The Economic Data Modeller allows you to explore the potential economic impact of improving the UK’s performance within 6 of the 10 components, and move the dial to demonstrate the possible incremental gains for individual sectors.

Business leaders’ perspectives on a renewed industrial strategy

In addition to understanding the priorities of different sectors, our research has also highlighted business leaders’ views on what a renewed UK industrial strategy needs to be in order to unlock growth:

73% believe that any future changes should be focussed on improving the general business environment, rather than the specific needs of individual sectors.

Business leaders see growth as their own responsibility. They look to the Government to set the framework within which they can pursue that growth.

For the most part, business leaders are focussed on how they can drive growth themselves – grasping new opportunities, improving efficiency, and investing to scale. While 81% of business leaders view an industrial strategy as essential for promoting economic growth, few have a clear ‘wishlist’ of changes that would benefit their sector. Rather, for many, the focus is on wider shifts that they feel would benefit the economy as a whole, such as reform of the planning regime, improving the ‘work readiness’ of school leavers and graduates, or investment in key national infrastructure. Importantly, a clear vision, directed action and certainty in these priority areas is often seen as missing, constraining their ability to grow.

35% of business leaders don’t currently believe that government policy has a large impact on growth in their sectors.

To unlock growth, there is a need to build trust in the certainty and longevity of an industrial strategy.

Among surveyed business leaders in our research there is widespread agreement that a clear, and long-term industrial strategy can unlock growth and investment. However, trust that this can be delivered is low, with past strategies seen to have been short-lived and subject to frequent change. Across the sample, broad stability and predictability was consistently prioritised over a strategy focussed on their sector or industry.

Given this starting point, an industrial strategy in and of itself will not be enough. Businesses are unlikely to engage without clear signs from the Government that the strategy offers certainty against which businesses can take decisions and invest. 

There was an appreciation amongst the businesses we spoke to that any long term strategy will at times need to reprioritise and evolve, but they felt clarity on it’s objectives, as well as the logic that underpinned it’s chosen areas of intervention and investment, would allow for greater certainty and confidence.

Any industrial strategy must include a plan for the public sector.

In our research we spoke to senior leaders in both the public and private sector who questioned the exclusion of a plan for the public sector from past industrial strategies. For these leaders, any strategy that focuses on the private sector, to the exclusion of the public sector, is only looking at half the picture. A well-functioning public sector was viewed as essential to providing the healthy, skilled and connected population necessary for businesses to thrive. Improved productivity within the public sector was also highlighted as a catalyst for wider economic growth as it would enable a greater number of more productive partnerships and collaboration with the private sector. 

The public sector was also seen as offering considerable opportunities to attract investment and support growth – examples sighted included using the NHS’s international renown to attract investment in health sciences, or using public sector bodies as anchor institutions to help stimulate growth in a region. Businesses felt that while these opportunities are undoubtedly being explored, an new approach to industrial strategy would offer an opportunity to fully integrate this across sectors and services and underpin growth across the economy.

“I think we need a much more open conversation about public services in the round. Previously we’ve done industrial strategy without getting all the necessary partners onto the page. It should be joined up and it’s not.”

Health and social care provider

Success will require a level of collaboration between business and government that is currently lacking.

There was an appreciation from the business leaders we spoke with that building a successful long-term industrial strategy will inevitably be complex. One of the core challenges will be establishing a deep understanding of the opportunities and challenges faced by different sectors and regions. This knowledge can only stem from deep collaboration between the Government, businesses, trade unions, local leaders and other stakeholders who can influence and inform decision making. 

Despite this clear need, only just over half of the business leaders we heard from feel that past governments have listened to businesses when designing policies to promote economic growth. Many of the business leaders we spoke to were sceptical as to whether the needs of their sectors would be considered in any future industrial strategy. However, a large number of business leaders admitted that they rarely engaged the industry bodies who represent the views of their industries to policy makers. Lower representation was particularly acute amongst micro businesses (0-9 employees) and smaller businesses (10-49 employees), which raises an additional challenge given that small and medium sized businesses (0-250 employees) account for 99.9% of all UK business and generated 52.5% of the total turnover.

  • Only 53% of business leaders in our survey feel that past governments have listened to businesses when designing policies to promote economic growth. 

  • Over 40% of business leaders we surveyed were neither members of, nor regularly engaged with, industry bodies which seek to inform Government policy.

Beyond these low levels of engagement, business leaders also highlighted work that they still need to do to bridge this knowledge gap. Whether it is the difficulty in predicting what skills will be most critical, or what technological investments would be most beneficial, businesses highlighted to us the difficulty they face in identifying how their needs are likely to change. Increasing the amount of time and effort businesses spend on planning for future risks and opportunities, and enhancing the level of collaboration at a sector level, will be fundamental to enhancing the shared understanding of businesses’ evolving priorities and helping to shape both national and local strategies in response.

“Engagement is the only way they’ll understand what’s needed and what’s lacking. [At the moment] the outcomes and follow-up are less visible, it feels like it goes into a black hole. You might find yourself having a similar conversation with someone else in government later on, but you don’t see anything that’s introduced that makes a difference.”

Retail business

Developing robust local industrial strategies will be crucial.

While the business leaders we heard from understood the role of national government policy in helping to tackle the UK’s barriers to growth, they highlighted that the changes most critical for their businesses - the skills system, planning system, infrastructure investment as well as the overall support made available to smaller businesses - were best driven at a local level. Companies felt that local planning and collaboration would be crucial in determining the right priorities and developing the most effective ways to accelerate growth. Business leaders told us however that these efforts would need to be properly funded, resourced, developed in partnership with local businesses and backed-up with sufficient powers if they were to stand any chance of being successful.

“There’s an absolute appetite for localised decision-making, and for more power for cities in terms of their policies. The role of central government is to direct policy and make sure it’s well funded, but more decision making with local government is important too.”

Infrastructure provider

* The research and modelling were conducted using ONS sector descriptions. This list reflects the PwC industry structure.

Contact us

Quentin  Cole

Quentin Cole

Head of Industries, PwC United Kingdom

Tel: +44 (0)7770 303846

Carl Sizer

Carl Sizer

Chief Markets Officer, PwC United Kingdom

Rachel Taylor

Rachel Taylor

Leader of Industry for Government and Health Industries, PwC United Kingdom

Tel: +44 (0)7841 783022

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