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The survey’s respondents identified China (79%) and India (45%) as posing the greatest challenge to the UK economy over the next 5 years followed by Japan and the US (both 35%). David Owen, head of consulting at Deloitte, commented: “The survey results clearly show the uncertainty that exists among the UK population when it comes to the growing prowess of India and China. However, it is in fact the European and North American countries who are responding better to the global challenge, for example, the US has last week committed to doubling its research and development spend.” 64% of survey respondents also expressed a negative reaction to offshoring and a quarter of respondents also held the view that existing offshoring programmes should be reversed with just 6% supporting their continuation. “Personal concerns around job security appear to be driving the negative view of emerging markets. These anxieties may be due to a growing awareness of the increased mobility of both resource and labour. There needs to be a greater understanding among the public that the transfer of certain jobs to other locations is a trend that is likely to continue and brings with it opportunities as well as threats. UK located companies should benefit from, rather than be threatened by the increasingly global nature of the product and services markets. “Part of the UK’s competitive success is the steady flow into and out of the country of skilled people. This ‘honey-pot’ economy should be one of the strengths of the UK, rather than a perceived threat. “With the UK becoming the world's largest recipient of foreign direct investment last year, ahead of both the US and China 1, the future may be somewhat more optimistic than the mood belying the general public.” 75% of survey respondents said that investment in education and training was required to maintain global competitiveness; the next highest being the 63% calling for improved infrastructure, followed by 60% saying more encouragement for small business start-ups. Around half of those surveyed said changes to the tax and regulatory frameworks, improved public services and working smarter (work life balance and work flexibility) were also needed. “One possible way for government to support raising skills is for tax credits to be awarded to businesses for training spend, similar to the incentives used to raise UK levels of innovation. This would bolster the current learning and skills grants,” added Owen. A separate Deloitte report, Trading Places, recently ranked the UK as sixth most competitive place to do business, amongst 25 major world economies. However, this ranking is projected to slide to 12th place within the next five years if UK Government and businesses do not work together to ensure the macroeconomic environment, skills, investment, enterprise and innovation continues to be world class in the UK. Key findings:
1 According to preliminary estimates by the United Nations Conference on Trade and Development
Trading places - How globalisation will drive future UK competitiveness Deloitte Competitiveness Index
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