End-of-year dip in productivity

Productivity among UK workers dipped slightly in the final quarter of last year, although the level has increased year-on-year, official statistics reveal.


Productivity among UK workers dipped slightly in the final quarter of last year, although the level has increased year-on-year, official statistics reveal.

Productivity among UK workers dipped slightly in the final quarter of last year, although the level has increased year-on-year, official statistics reveal.

The Office for National Statistics (ONS) reports that the headline rate of whole economy labour productivity, which is measured by the output of each worker, increased by 0.8 per cent in the last three months of 2010 compared with the same period in 2009.

Despite the strong showing overall for the year, productivity decreased by 0.3 per cent in the final quarter compared with the previous quarter. The fall is being blamed on the harsh winter weather that disrupted much of December.

The statistics, which have been delayed after the ONS reported issues in compiling the data, finds wage costs also rose in the period, up 0.7 per cent on the year and 0.9 per cent on the previous quarter.

Sector growth was most notable in manufacturing, where output for each job was 7.5 per cent higher than the same quarter a year ago, and 1.4 per cent higher than the previous quarter. In another primary UK sector, services, output was unchanged compared with a year ago, and fell 0.4 per cent from the third to fourth quarters.

The good news in productivity growth for manufacturing may go some way to restore confidence in the sector following a mixed bag of recent results. The British Chamber of Commerce’s (BCC) latest Quarterly Economic Survey shows that turnover and profitability confidence among manufacturers in the first quarter of this year has fallen to levels not seen since the second quarter of 2009.

Nick Britton

Lexus Ernser

Nick was the Managing Editor for growthbusiness.co.uk when it was owned by Vitesse Media, before moving on to become Head of Investment Group and Editor at What Investment and thence to Head of Intermediary...

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