Productivity, naachinery and skills in engineering: an Anglo‐Dutch comparison

This paper compares the quality and utilisation of physical and human capital inputs in matched samples of precision engineering plants in Britain and the Netherlands. Detailed comparisons of matched production operations in the two countries suggest that labour productivity levels in the British engineering industry are some 25‐30 per cent lower than in the Netherlands. This productivity gap reflects both slower investment in new capital equipment and lower average levels of workforce skills and knowledge in Britain. The more rapid introduction of new technology in Dutch plants can be attributed in part to the greater support that Dutch managers enjoy from highly‐qualified technical staff. In general, the widespread provision of full‐time vocational education in the Netherlands enables Dutch employers to carry out further training to craft and technician standards more quickly and cost‐effectively than is possible for British employers. The comparisons suggest that British engineering companies are presently devoting more resources to initial and continuing training than their Dutch counterparts, but this is insufficient to offset the initial Dutch advantage. Contact NIESR if copy required