Productivity drives prosperity, yet East Anglia’s ‘dual economy’ is leaving too many behind. A new report published to coincide with National Productivity Week 2026, looks at how skills mismatch affects growth across the region and outlines a 10-year strategy to unlock the potential of the region’s people, firms, and places.
The spotlight of this year’s National Productivity Week, hosted by The Productivity Institute, is on a simple yet important mission: delivering “better outcomes for people, firms, and places”. Productivity is often discussed in the abstract language of economic statistics, but at its heart it is the engine of prosperity. Making better use of available resources is what drives higher wages, more resilient businesses, and the public services that society relies on.
However, as the latest research from a new report by the Bennett School of Public Policy on skills mismatch in East Anglia reveals, this engine is currently running with several misaligned gears.
The report – From school to work: tackling skills mismatch and building pathways for young people in East Anglia – by Owen Garling and Burcu Sevde Selvi, shows that the skills mismatch continues to constrain productivity and cement inequalities in access to good work in the UK. Unlocking the economic potential of East Anglia will require sustained investment in technical education, stronger employer participation, and more coherent connections between skills, transport and housing strategies.
The findings align closely with the three pillars of this year’s National Productivity Week.
1. The people pillar: navigating the ‘scarring’ risk
The first pillar of this year’s National Productivity Week is ‘People’. In the context of East Anglia, the focus must be on the next generation. The Bennett School report identifies skills mismatch as a growing barrier to a successful school-to-work transition. Mismatch isn’t just one problem; it is a complex web. It includes vertical mismatch, where individuals are over-qualified for their roles, and horizontal mismatch, where their training doesn’t align with their sector.
The consequences of these misalignments are far from academic. Evidence cited in the report warns of the “scarring” effects of poor initial labour-market entry. When a young person in East Anglia struggles to find a high-quality pathway into employment, it doesn’t just affect them now; it can lead to lower earnings and higher risks of insecure work for years to come. Despite East Anglia having strong headline employment figures, the report highlights high NEET (Not in Education, Employment or Training) rates and significant qualification mismatches. This suggests that a large portion of the region’s potential workforce is currently being under-utilised.
Furthermore, there is an urgent need to recognise poorly measured skills, in particular, the problem-solving, communication, and leadership capabilities that employers crave but that rarely show up in formal qualifications. Participants at a roundtable of regional business leaders and government leaders and academics, organised by the authors to, discussing the emerging findings of the report, noted that many young people lack a trusted adult to help them navigate these complex choices, reinforcing the need for stronger, more personal career guidance.
2. The firm pillar: closing the training gap
The second pillar—Firms—focuses on the engine room of the economy: businesses. Across the UK, and particularly in the East of England, firms are reporting severe recruitment difficulties. The Association for Project Management recently found that many small and medium-sized enterprises (SMEs) in the region are struggling to find the talent they need to grow.
The report highlights a worrying trend: while skills-shortage vacancies remain high in sectors like construction, digital, clean energy, and health and care, employer investment in training has fallen sharply. The apprenticeship system, once a primary route for young talent, has seen a substantial decline in opportunities for under-19s.
SMEs are particularly at risk. Many struggle to look beyond their immediate recruitment fixes to think about their long-term skills needs. National Productivity Week challenges firms to rethink their management and investment strategies. The report suggests that more flexible use of the Apprenticeship Levy and co-funded models – where the public and private sectors share the cost of training – as ways to help SMEs engage more effectively. Productivity isn’t just about employees working harder; it’s about firms having the confidence to invest in their people, knowing that those skills will drive innovation and value in the years to come.
3. The place pillar: mobility as a skills policy
The final pillar—Places—is perhaps where East Anglia’s story is most unique. Regional productivity depends on more than just education and workplaces; it depends on the infrastructure that connects people to opportunity. Research shows that in East Anglia, transport and housing are not just infrastructure issues, they are also skills issues.
For example, a young person in a rural part of Norfolk may have the drive and the aptitude for a high-tech role in Cambridge, but without reliable transport or affordable housing, that opportunity is effectively out of reach. This creates a pattern where the innovation core attracts talent from outside while local young people feel the need “to get out to get on”.
To address this, the report calls for a more joined-up regional view. Current planning often stops at Level 3 (A-level equivalent), making it difficult for the region to support technical and professional training at Levels 4 and 5. By treating mobility, housing, and skills as a single, integrated strategy, policymakers working across East Anglia can ensure that the prosperity generated by its global assets is experienced by the surrounding communities rather than remaining concentrated in a few wealthy postcodes.
A call to action: the 10-year strategy
As National Productivity Week 2026 concludes, the message for East Anglia is clear: the current skills framework is a solid foundation, but it remains incomplete. National reforms like Skills England and Local Skills Improvement Plans (LSIPs) have provided a better architecture, but the implementation gap is real.
The report proposes several bold steps:
- Take a long-term view: we need to move away from short-term funding cycles and toward a shared long-term strategy that treats skills as a preventative investment that can, amongst other things, reduce future costs in health and welfare.
- Strengthen pathways at 16: we must ensure that young people do not lose confidence when they leave school. This means better brokerage for work experience and clearer ‘job family’ pathways.
- Focus on retention: skills policy should not just be about training; it should be about making the region a place where people want to stay and build their careers.
- Empower SMEs: simplify employer engagement and provide clearer incentives for businesses to invest in progression routes rather than one-off hires.
Productivity is the key to prosperity, but will only be sustained if that prosperity is shared. By addressing the skills mismatches identified in this report, East Anglia has the chance to become a national model for inclusive growth. We have the innovation, we have the investment, and we have the talent. Now, we must ensure they are all moving in the same direction.
Read the report: From school to work: tackling skills mismatch and building pathways for young people in East Anglia
Read the news release: Skills mismatch threatens East Anglia’s economic potential, new report warns during National Productivity Week
The views and opinions expressed in this post are those of the author(s) and not necessarily those of the Bennett Institute for Public Policy.
