One of the reasons for the UK productivity gap is our oversize services sector. In services businesses meet demand by adding headcount, and falling demand is me

One of the reasons for the UK productivity gap is our oversize services sector. In services businesses meet demand by adding headcount, and falling demand is met with layoffs. Since UK hire and fire rules are more flexible than eg FR/DE that works for secs biz. We do still have a manufacturing sector, but much of it is invisible as its the arms industry, where Britain is still a big player. That's OK because the arms industry is less price sensitive than consumer manufacturing like cars, white goods etc. In those sectors strict rules on hire and fire has forced FR and DE industry to figure out how to scale by means other than headcount.