The UK’s low levels of output per hour of labour and their productivity relative to other advanced economies is a matter for concern. The UK’s productivity is a little over three-quarters that of Germany, the US, and France, and the about same as Italy. Furthermore, according to the OECD, it has been stagnant since 2007. Productivity is an important macroeconomic indicator as it demonstrates the output that an economy can generate using existing resources. It is generally acknowledged that technological progress, new research and technology can lead to higher investment and growth rates. Productivity refers to the quantity of goods and services that can be produced by a worker in a given period of time. For any economy, it is important to ensure rapid growth and a long-term trend of increased productivity. Indeed, this is particularly important for advanced economies where it is crucial to increase productivity in order to remain globally competitive. The study concludes that the UK’s growth in productivity has been very slow relative to other major economies, and as a result the UK, which was already behind many other G7 countries, has fallen even further behind. This study suggests that a stronger and more viable manufacturing sector would help to build structural balance in the economy and to move it away from an over-reliance on the financial sector. To achieve this would require active state polices to increase investment in R&D, innovation and skills.