Commentary – Productivity

UK labour productivity has grown at just under 2% on average since 1960, but since 2008 it has stalled.

Compared with other major industrial nations UK productivity grew quickly in the 1990s and early 2000s. The recent stalling in productivity seen in the UK can be seen in other countries since 2007, and especially in Italy since 2000.

UK productivity was around 15% lower in 2011 than the G7 average. In 2006 it was only 4% lower.

On a wider international comparison the UK’s average annual productivity growth in the years 2000-2014/5 was, like the rest of ‘old Europe’ (e.g. Italy, France, Germany and Spain) relatively low. The performance of countries in ‘new Europe’ (e.g. the Slovak and the Czech Republics, Poland and Hungary), was noticeably stronger. Italy’s performance has been especially weak.