Productivity Measurement Analysis series – insights from Q2, 2023
The Productivity Measurement Analysis series, authored by experts in the Institute’s Productivity Lab, reports on productivity trends in the UK, United States and the Euro Area, following the reporting of national statistical agencies. More so than with most other measures, the long-term trend in productivity growth is a critical element of economic growth.
Analysis of productivity for Quarter 2, 2023
UK labour productivity rebounds in Q2, 2023 by Professor Raquel Ortega-Argilés
A new productivity data release from the Office for National Statistics (ONS) in August revealed that the UK’s productivity growth experienced a rebound in its estimates of labour productivity. The UK’s labour productivity, measured as productivity per hour worked, has shown an increase of 0.1% compared to the same quarter in 2022 and 0.7% compared to the first quarter in 2023 and is now 1.4% higher than before the COVID-19 pandemic. The latest reading was driven by a 0.2% quarterly increase in gross value added (GVA) and a decrease in the number of hours worked (-0.5%).
Growing strength of US economic expansion leads to productivity boost by Martin Fleming
The growing strength of the US economic expansion – as opposed to a generative AI miracle – boosted nonfarm productivity in the second quarter with a 3.7% outsized increase. The improvement, on annualised basis from the first quarter, reversed six quarters of decline. A 2.4% output increase and a 1.3% decrease in hours worked resulted in the largest quarterly increase since the end of the 2020 pandemic-driven recession.
Post-pandemic labour productivity figures for the Euro Area continue to disappoint by Klaas de Vries
According to figures released on September 7, labour productivity in the Euro Area, defined as real GDP per hour worked, fell in the second quarter of 2023 compared to the previous quarter by 0.2 percent. The fall was even bigger at 0.4 percent when excluding the Irish data, which tends to be quite volatile due to profit-shifting behaviour by US multinationals. The Q2 decline represents the third quarter of back-to-back declines in labour productivity for the Euro Area, representing the worst streak of quarterly declines since the Global Financial Crisis in 2008/2009.
Read the Q1, 2023 analysis for
The Productivity Lab is The Productivity Institute’s data science centre of excellence, the “engine room” for collecting, disseminating, and producing productivity data.