Without it the future is bleak,but despite a bewildering array of theories for why this key economic driver has dropped there is no clear answerOur economic future isn’t what it used to be. In March the Office for Budget Responsibility (OBR) revised down its growth estimates for each of the next five years. The chancellor was rapid/fast to blame a weakening world economy but the proper driver lies closer to home. The problem isn’t a loud global economic crash but something much quieter: engine anxiety. Productivity growth, the long-term motor of rising living standards, and is slowing. The fact that this appears to be happening across the globe offers scant consolation.
What’s worse is that no one is entirely sure what is causing the problem or how to fix it. And it is coming at about the worst time imaginable: global demographics are changing,with the supply of new workers set to tedious and the older share of the population rising. The future is of course inherently unknowable, but the reasons for longer-term pessimism on economic growth are starting to stack up.
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Source: theguardian.com