·    manufacture of food, drink and tobacco - ranked 2nd only to Canada

·    manufacture of furniture, jewellery, musical instruments, toys and miscellaneous products and recycling - ranked 1st amongst all competitor countries

·    transport - ranked 2nd only to the United States

·    agriculture, hunting forestry and fishing - ranked 2nd only to Japan.

However, the research also revealed weaker performance across some sectors including:

·    wholesale, retail and car repairs

·    financial services

·    energy and chemicals

·    manufacture of transport equipment sectors.

This performance suggests that the UK’s productivity gaps are associated with particular sectors rather than general poor performance as is often thought.

Professor Mike Campbell, Director of Strategy and Research at the Sector Skills Development Agency, said: “Although the UK is the world’s fourth largest economy, and is currently enjoying a period of unprecedented stability, this research has highlighted there are areas of weakness and concern. Productivity variations do exist across different sectors of the economy reinforcing the position that no single skills strategy can be applied to all sectors.

“Sector Skills Councils have a key role to play by understanding future skills needs and then bringing employer-led influence to bear on all the critical factors linked to skills which determine the nation’s ability to perform at a world class standard.

“Unless solutions can be found, the UK could find itself overtaken by its economic rivals in the global market and unable to fulfil the promise of its businesses and public services and the aspirations of individuals.”

Skills for Business - the network of Sector Skills Councils covering around four out of five workers in the UK - is working with employers and training providers to improve the provision of employer-friendly training throughout the UK and raise productivity levels.Employers seeking to address the skills shortages within their organisations or requiring advice on skills development should contact their relevant Sector Skills Council via www.skillsforbusiness.org.uk

- Ends -

Notes to editors:

For further information or to request a copy of the full research report, please contact:

Ric Shadforth / Sally Clift on 020 7861 3029 / [email protected] / [email protected]

OR

Alex Curling, Head of PR, Sector Skills Development Agency, on 01709 765435 or 07879 602669 / [email protected]

Notes to editors

*Sectors Matter: An International Study of Sector Skills and Productivity, published on 24^th October 2005.The research was carried out for the SSDA by the Institute for Employment Studies (IES). Copies can be downloaded from www.skillsforbusiness.org.uk or call 01709 765444.

The sector definitions are not coterminous with the Sector Skills Council footprint definitions. They are broad sectors of the economy which preserve the traditional manufacturing and services boundaries. Further technical definitions can be found in the full report.

About the SSDA

The Sector Skills Development Agency (SSDA) was established in 2002 with a UK-wide remit to address skills deficiencies through the creation of a network of employer-led Sector Skills Councils (SSCs).The SSDA is responsible for funding and supporting the network, which will comprise some 25 SSCs covering around 80 per cent of the UK workforce by the beginning of 2006.

About SSCs

SSCs are independent, employer-led organisations tasked by the government with identifying and addressing the skills needs of employers within their sector.SSCs are licensed by the Secretary of State for Education and Skills, in consultation with Ministers in Scotland, Wales and Northern Ireland, to reduce skills shortfalls and increase productivity within their sectors throughout the UK.

About Skills for Business

Skills for Business is the umbrella identity for the SSDA and SSC network.

Full information on the SSDA, SSCs and Skills for Business is available online at www.skillsforbusiness.org.uk