Up productivity to boost economy, lobby group says

The Isle of Man Chamber of Commerce represents more than 500 firms

A drive to boost the Manx economy should focus on "improving productivity" within the workforce rather than population growth and new post creation, a business lobby group has said.

The government's 2022 economic strategy includes the targets of creating 5,000 new jobs and increasing the number of residents by 16,000 to 100,000 by 2037.

Chamber of Commerce president Kristan McDonald told a Tynwald committee "pure job creation" would not "necessarily get us a stable and resilient economy".

Fellow chamber member Carol Glover also said the jobs plan could be "fundamentally flawed" due to the changing needs of businesses and digital advancements.

Giving evidence to the Economic Policy Review Committee, she said artificial intelligence (AI) was "driving incredible productivity gains" around the world and many jobs seeing the fastest decline, such as postal and banking clerks, were still seen on the island.

Ms Glover, who is the vice president of strategy for the chamber, said the "challenge" for the economic strategy was how people would be upskilled.

The government recently announced a programme to upskill the Manx community on the use of AI and a strategy to look at how to plug skills gaps in the workforce.

Improvements

Mr McDonald said there had been "significant distribution in the economy as a result of forces like AI, which is not mentioned in the [economic] strategy to any great degree".

The island also needed to "stop trying to fight reality" in terms of the challenges population growth presents, such as increasing the cost of housing.

Echoing previous calls for a rethink of the strategy, he told the panel he felt the original targets had not been "set correctly".

The government should instead be focussing on making improvements to the productivity of existing workers along with the island's infrastructure and services, such as health care and education, which would in turn help to retain the existing workforce, he added.