Productivity in Sheffield City Region is less than half that in Oxford and London, according to universities minister Jo Johnson.
He made the claim on a tour of the Advanced Manufacturing Research Centre, part of Sheffield University, and then announced vocational degrees for apprentices to “plug the gap”.
They will be funded with £1.6m from the Higher Education Funding Council.
In his first major speech since being appointed minister for universities, science and innovation, Jo Johnson said: “We know that the only way to secure a truly national recovery is through a fundamental rebalancing of the British economy.
“To ensure that productivity grows nationally we need to empower cities like Sheffield to reach their full potential.
“Productivity here is currently less than half that in Oxford and London.
“Research and innovation have a critical role to play in plugging these productivity gaps around the country.
“The new degree-level apprenticeship programme being developed by the University of Sheffield with employers will provide a way for students to take their capabilities to advanced levels, and not only means brighter prospects for them, but provides a stronger talent pool for businesses.”
University of Sheffield vice-chancellor, Prof Sir Keith Burnett, said: “Universities have a key role to play in driving innovation, economic growth and creating jobs.
“Just last week, the Government’s Productivity Plan laid out the challenge to the UK to find an ‘extra gear’.
“A key element of this is the very best quality skills of the kind being demanded by high-tech industries such as aerospace and automotive. This is why we have added to our world-class research centres an advanced apprentice route which opens up degree level study and beyond in a university environment.”
The Royal Academy of Engineering forecasts the UK needs an extra 50,000 science, technology, engineering and maths technicians and 90,000 professionals every year just to replace people retiring from the workforce.