# Julian Jessop: Weak productivity growth since the financial crisis, the AI revolution will drive economic expansion, and excessive regulation hinders corporate performance | The Peter McCormack Show > Source: > Published: 2026-06-06 19:16:12+00:00 # Julian Jessop: Weak productivity growth since the financial crisis, the AI revolution will drive economic expansion, and excessive regulation hinders corporate performance | The Peter McCormack Show AI advancements promise to boost productivity, challenging fears of an economic slowdown and improving living standards. ## Key Takeaways - Productivity has been weaker since the global financial crisis, impacting economic growth. - Enhancing productivity is crucial for improving living standards and wages without harming the environment. - Increased regulation has diverted companies’ focus from productivity and profits. - The size of the state has grown excessively, contributing to economic challenges. - The AI revolution is expected to boost productivity, countering fears of a slowdown. - Government interventions often miss addressing root causes of economic problems. - Public opinion sometimes supports economically unsound policies. - Inequality in the UK has remained relatively stable over the decades. - Government policies have inadvertently discouraged hiring young people. - The current employment system may hinder young people’s learning by making it hard to dismiss them. - Addressing supply-side issues is key to solving economic problems. - Technological advancements like AI could drive the next wave of economic growth. ## Guest intro Julian Jessop is an independent economist and former Chief Economist at the Institute of Economic Affairs. He has also served as Economics Fellow at the free-market think tank and writes regularly on UK growth, taxation, regulation, and economic policy. ## The impact of productivity on economic growth - Productivity has been much weaker since the global financial crisis than before. — Julian Jessop - Enhancing productivity is essential for increasing wages and living standards. - Getting productivity up is the best way to make people worth more to their employers. — Julian Jessop - Improved productivity can drive economic growth without environmental damage. - Understanding post-2008 productivity trends is crucial for economic policy. - Weak productivity growth affects living standards and economic expansion. - Productivity improvements are linked to sustainable economic growth. - It’s a key driver of living standards and wages. — Julian Jessop - Addressing productivity issues can lead to significant economic benefits. - The global financial crisis marked a turning point in productivity trends. - It’s also the best way to grow the economy without doing things like damaging the planet. — Julian Jessop - Productivity is a critical factor in economic recovery and growth strategies. ## The role of regulation in corporate performance - Regulatory increases have shifted companies’ focus away from productivity and profits. — Julian Jessop - Companies face challenges balancing regulation with productivity goals. - Increased regulation can detract from corporate efficiency and profitability. - Understanding the regulatory impact is crucial for business strategy. - The number of people regulating and managing these rules has significantly increased. — Julian Jessop - Regulation can create barriers to economic performance and growth. - Companies may prioritize compliance over innovation due to regulatory demands. - Companies have lost a lot of the focus on productivity and profits. — Julian Jessop - Balancing regulation and economic performance is a key policy challenge. - Excessive regulation may hinder corporate competitiveness. - The regulatory environment influences business priorities and strategies. - Addressing regulatory burdens can enhance corporate productivity. ## Government intervention and economic challenges - The state has become too large, contributing to economic issues. — Julian Jessop - Government size and intervention are critical factors in economic policy. - Government borrowing and public debt are far bigger than they were ten or twenty years ago. — Julian Jessop - Large government can lead to inefficiencies and economic challenges. - Understanding state intervention is vital for addressing economic issues. - Excessive government size can strain economic resources and growth. - The fact the state has simply got too big. — Julian Jessop - Balancing government intervention with economic freedom is crucial. - Government policies may not always address underlying economic problems. - The size of the state is a significant factor in economic policy debates. - Addressing government size can lead to more efficient economic management. - Evaluating government intervention is key to economic reform strategies. ## Technological advancements and productivity growth - The AI revolution will drive productivity growth, countering claims of a structural slowdown. — Julian Jessop - AI is expected to play a significant role in future economic growth. - Technological advancements can offset productivity slowdowns. - We’re probably in the fourth or the fifth industrial revolution already. — Julian Jessop - Understanding AI’s impact is crucial for economic forecasting. - The AI revolution offers opportunities for economic expansion. - I think that’s clearly now out of date because we’ve now got the AI revolution coming through. — Julian Jessop - Embracing technology can enhance productivity and growth. - AI-driven productivity growth challenges pessimistic economic forecasts. - Technological change is a key driver of economic development. - AI advancements could reshape economic landscapes and productivity. - Leveraging AI is essential for future economic strategies. ## Government policies and their effectiveness - Government interventions often fail to address the root causes of economic problems. — Julian Jessop - Effective policy requires addressing supply-side economic issues. - Government actions may focus on short-term fixes rather than long-term solutions. - What governments don’t do is step back and look at the root causes. — Julian Jessop - Understanding policy effectiveness is crucial for economic reform. - Addressing root causes can lead to more sustainable economic solutions. - Problems typically lie on the supply side of the economy rather than demand side. — Julian Jessop - Evaluating government interventions is key to economic improvement. - Effective policies require a focus on underlying economic issues. - Government interventions should prioritize long-term economic health. - Addressing supply-side issues is essential for effective economic policy. - Understanding policy impacts can lead to better economic outcomes. ## Public opinion and economic policy - Public opinion often supports economically questionable policies. — Julian Jessop - There is a disconnect between public sentiment and sound economic policy. - Understanding public opinion is crucial for effective policymaking. - There are plenty of economic policies that poll very highly. — Julian Jessop - Policymakers face challenges aligning public preferences with economic principles. - Evaluating public opinion can inform better economic strategies. - Anybody would think are mad that nonetheless poll very highly. — Julian Jessop - Addressing the gap between public opinion and policy is crucial. - Public sentiment can influence economic policy decisions. - Understanding voter preferences is key to effective economic governance. - Aligning policy with sound economic principles is a policy challenge. - Evaluating public opinion can lead to more effective economic policies. ## Inequality and economic perceptions - Inequality in the UK has not massively increased and has been relatively flat for decades. — Julian Jessop - Understanding inequality trends is crucial for economic policy. - Common perceptions about inequality may not align with data. - Inequality has been pretty flat for decades now. — Julian Jessop - Evaluating inequality is key to effective economic strategies. - Addressing misconceptions about inequality can inform policy debates. - In many cases has actually fallen. — Julian Jessop - Understanding wealth distribution is crucial for economic reform. - Evaluating inequality data can lead to better economic policies. - Addressing inequality perceptions can enhance policy effectiveness. - Understanding economic trends is key to addressing inequality issues. - Evaluating inequality is essential for informed economic policymaking. ## Employment policies and youth opportunities - Government interventions have created disincentives for employers to hire young people. — Julian Jessop - Understanding employment policies is crucial for youth opportunities. - Government actions may inadvertently hinder youth employment. - It’s much less attractive for employers to take on young people. — Julian Jessop - Addressing employment barriers is key to improving youth opportunities. - Evaluating employment policies can enhance youth job prospects. - Government policies can impact youth employment and opportunities. - Understanding policy impacts is crucial for improving youth employment. - Evaluating government actions can lead to better employment strategies. - Addressing employment disincentives is key to youth economic opportunities. - Understanding employment trends is crucial for policy effectiveness. - Evaluating employment policies can enhance youth job opportunities. ## Employment systems and youth development - The current employment system is failing young people by making it too difficult to dismiss them. — Julian Jessop - Understanding employment rights is crucial for youth development. - Employment protections may hinder youth learning and responsibility. - We’re actually doing a disservice to young people by not making it easy to sack them. — Julian Jessop - Addressing employment challenges is key to youth development. - Evaluating employment systems can enhance youth learning opportunities. - When it’s easy to sack them, they perhaps have to go home and think about why they got sacked. — Julian Jessop - Understanding employment impacts is crucial for youth opportunities. - Evaluating employment policies can lead to better youth development strategies. - Addressing employment system issues is key to youth economic opportunities. - Understanding employment trends is crucial for policy effectiveness. - Evaluating employment systems can enhance youth development opportunities. **Disclosure:** This article was edited by Editorial Team. 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