The UK’s efforts to boost productivity while ironing out regional inequalities in job creation may be fundamentally at odds, according to a study of so-called ‘gazelle’ firms.
The findings, based on a study of 6.25m firms over a 17-year period by the ERC , shed new light on the spillover effects high-growth firms have on other businesses in their region.
- Enterprise Research Centre study shows higher numbers of fast-growing firms in a region can lead to net loss of jobs, especially in rural areas
- But clusters of companies that combine job growth with productivity gains have a positive impact from ‘spillover’ effects
- Policymakers need to be aware of trade-offs from promoting job and productivity growth at the same time