Productivity and Skills in Industry and Services—A Britain-German Comparison (Distinguished Lecture)

It is widely accepted that the vocational and professional training system has a major impact on national competitiveness. In this paper a number of German-British studies in manufacturing and services are examined in order to show how skill systems have affected the comparative strengths and weaknesses of the two countries’ productivity performances. The studies have been conducted since the end of the 1980s to 2003 and have revealed specific links between vocational training, products and competitiveness on the basis of matched plant comparisons. The comparison between Britain and Germany has been chosen as these countries have very different national VET systems. The findings suggest that higher levels of apprenticeship training in German companies give them an advantage over their British counterparts with respect to flexibility to changes in markets, technology, quality and supply chains. The paper closes with a short discussion.