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1.2 Productivity


In the most recent quarter, labour productivity, as measured on an output per hour basis, has risen by 0.1% compared with the same quarter in the previous year; this follows four previous quarters of contraction. This sustained period of declining labour productivity represents a continuation of the UK's “productivity puzzle”, with productivity since the financial crisis in 2008 growing more slowly than pre-crisis.

Despite occasional periods of growth, this sustained general pattern of stagnation contrasts with patterns following previous UK economic downturns, when productivity initially fell, but subsequently recovered in a relatively sustained fashion. International comparisons of the level of productivity continue to show the UK below the average for the rest of the G7.

Indicator 1.2.1 – Labour Productivity: GVA per hour

Labour productivity is calculated as gross value added (estimate of the volume of goods and services produced by an industry and in the UK) per hour worked. The figures show seasonally adjusted data in nominal terms.

Indicator 1.2.2 – Productivity: GDP per hour

Indicator 1.1.2 illustrates recent international trends in constant price GDP per hour worked.

Indicator 1.2.3 - Multi-factor productivity

Changes in the economic output of the UK market sector can be decomposed into contributions due to changes in measured inputs of factors of production and a residual element known as multifactor productivity (MFP).

Indicator 1.2.4 – Regional disparities

Productivity is measured as gross domestic product (GDP, in purchasing-power adjusted euros) per hour. Bars represent the ratio of productivities between the most productive NUTS2 region in a country relative and the least productive NUTS2 region. The figure shows all countries for which 2016 Eurostat data on regional GDP and hours is available and which have at least 4 NUTS2 regions.  

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