Katja Hall interview: 'People must start to feel the difference in their pockets'

“Shall I start talking?” asks Katja Hall, as soon as she spies the red light on my recording device. Never let it be said that the Confederation of British Industry, the top employers’ body, doesn’t have something to say, especially with a general election looming.

But big business enters the new year with some old problems. Even though the economy is in far healthier shape than it was 12 months ago, low levels of public trust and the feeling that bosses don’t contribute enough to society linger. Hence the CBI’s message is changing, but so too is the voice it is delivered in.

“Ultimately, we know business won’t be listened to unless it’s trusted,” says Hall, 42, whose rise-and-fall accent betrays her Swedishness, another departure from the male corporate clique of old. As the CBI’s deputy director general since last May, she has already become a fixture on the Today programme, forming a double act with John Cridland, the director general who hired her to the organisation as a policy adviser 19 years ago. With Britain’s future in Europe and getting more women back into the workforce high on the agenda, the challenge might be to get this “EU migrant” and mother-of-two to stop talking.

“This is the year we have got to crack it,” she says, of boosting trust in the 190,000 businesses the CBI speaks for and spreading the benefit of the recovery to the seven million people they employ in total.

“Business has got to show that economic growth can make a difference. People have got to start to feel like it’s a recovery and start to feel the difference in their pockets.”

There are plenty of signs that workers will feel better in real terms, but mainly because inflation has fallen thanks to the tumbling oil price and a war at the supermarket check-outs, not because employers have suddenly become more generous by hiking wages. It is no wonder the person on the street still tends to think of UK plc in terms of them and us. “We did some polling that just over half of the public trust business to make a positive contribution to society, so that is quite a serious challenge,” admits Hall. The pay picture is looking better, but boosting productivity is the “only sustainable way to raise wages”, which means training people to do more.

In the meantime, she is pushing positive stories as part of an “honest conversation”, such as the 1.5 million jobs McDonald’s has created in Britain in 40 years, or carmaker Honda’s apprentice drive. But Hall admits: “One of our members said ‘you can’t talk yourself out of something you have behaved yourself into’, which I thought was quite a good quote.”

The CBI’s contribution to the living standards debate is to dismiss as a “quick fix” Labour’s plan to hike the minimum wage to what Hall calls “an unaffordable level”.

Instead, it favours raising the threshold for national insurance payments, improving education – Cridland has called for a scrapping of GCSEs – and overhauling childcare by extending maternity pay and offering 15 hours of free childcare a week – currently available for three-year-olds – to younger children as well.

“What happens at the moment is a lot of women leave work at the end of their maternity leave or perhaps go back to a job that is less skilled than the one they left behind because of a lack of flexible working,” Hall explains.

It sounds like great news for staff and manageable for large firms, but a headache for small enterprises. The CBI, after all, has made a big play about representing all business, but its critics say it will always put the biggest corporations first.

Hall admits: “For small firms it can be a bit of an issue if you haven’t got someone else to cover the person who wants to be off every Friday, but I think in a lot of cases you can work around it. You have got to weigh that against the fact that you get to keep a really good employee. Increasingly we shouldn’t see this as just being about women, it should be about men with children, but also it should be about men and women whether or not they have children.”

Hall has had two children in the time she has been at the CBI and still managed to climb the greasy pole. Those firms that she says “should be doing more to help people progress,” and where there are “not enough ladders into highly skilled jobs” should see her career as instructive.

“I came back [from maternity leave] part-time first of all. I used to work three days a week and now I work full time but from home on Fridays and I take my kids to school on Wednesday, so I still have some flexibility,” she says. “What I wanted, and I guess what a lot of women want, varies with how old the children are. Now they are at school there is no reason for me not to work but when they were tiny it was nice to have a day at home with them.”

The young Hall had a long-standing interest in politics but gained entrepreneurial insights from her father, who brought his 17-year-old daughter to London in 1989 when he moved his shipbroking firm to the capital. Until that point she had lived in Trollhattan, known as “the Detroit of Sweden” for housing the home of the Saab automotive production line. The contrast with small-town Sweden was “fun and exciting” but she wasn’t settled.

“Even at university [in York] I wasn’t sure if I was definitely going to stay in England.” That changed when she met her future husband, Chris. Hall joined the CBI straight from university, when her first job interview was conducted by Cridland. Their professional relationship – “we compliment each other very well I think” – has endured even when she left to work for the BBC. Clocking up almost five decades of CBI service between them, neither has run a business, but that is not the point, she says.

“We speak to people who run businesses every day so I think we have a good sense of what business wants from public policy and what makes good public policy.”

The CBI hasn’t always got it right, championing adoption of the euro once upon a time and getting into a muddle during the Scottish independence debate by reversing a decision to register as a No campaigner with the Electoral Commission. But it has the ear of ministers at home and has carved out links abroad to help the Government’s mixed results in boosting exports.

After so many years here, Hall sees herself as an “honorary Brit”. Living up to the stereotype, she still shops at Ikea for meatballs and feels most Swedish during football fixtures or the Eurovision Song Contest. Hall’s family spent New Year on an island an hour north of Gothenburg, where her father retired. Now back to work, the election is in sight. Hall sees a mixed bag of policies from the main political parties.

“We like what we see from Labour on skills and industrial strategy but are concerned about what they say on markets,” she says, referring to Ed Miliband’s promise to freeze energy prices and carve up Britain’s banks if he gains power. “But then, equally, on the Conservative side we like what they have done on tax but we don’t think the net migration target is a good thing.”

She is likeable, engaging, a bit too on-message: so is the top job in her sights? A longish answer concludes with: “For now I am just enjoying this job”. So that’s definitely maybe, then. And why not? For British business to succeed, it must speak with many voices.

Education: Studied the International Baccalaureate at the International School of London after arriving from Sweden in 1989 at 17. Graduated in economics and politics from the University of York in 1995. Also gained an MA in international relations from Nottingham University.

Career: Joined the CBI in 1996 straight from university as an employment policy adviser. Left to work in human resources for the BBC for three years but returned, becoming the CBI’s employment director, then chief policy director in 2011 and deputy director general last May. She also sits on the Government’s Creative Industries Council.

Personal: Lives in Pinner, north-west London, with her husband, Chris, who works in IT for financial news group Bloomberg, and two daughters, aged 11 and eight. Relaxes by running and skiing – she was five when she learnt – and walking the family’s miniature schnauzer, Henry, although: “He walks me really”.