G7 Productivity Gap Widest Since 1993

The latest comparison of productivity across the G7 countries shows that output per hour in the UK was 16 points below the average for the rest of the major industrialised economies in 2011. It was also 21 points lower than the rest of the G7 in terms of output per worker. It is the widest productivity gap since 1993. Growth in GDP per hour grew in line with the rest of the G7 and faster than the US and Germany. Output per worker was unchanged between 2010 and 2011.

Falls In UK Productivity Levels

Productivity per worker in the UK fell relative to all G7 countries except Italy and Germany in 2010, but it was above that of Japan and similar to Canada. The productivity gap between the UK and the US is the biggest since 1994. All G7 countries have seen an increase in GDP per worker and GDP per hour between 2009 and 2010. UK productivity was lower than the G7 average on both measures. GDP per worker was lower than in France, Italy and the US (the highest in G7).

All G7 countries experienced productivity growth in GDP per hour worked in 2010. In the UK growth was the result of a combination of a fall in actual hours worked and an increase in GDP. While the UK experienced a fall in hours worked per worker between 2009 and 2010 other countries saw a reduction in total hours as a result of lower employment.

The US saw the largest growth in GDP per worker of the G7 countries. The UK previously a fast growth country saw falls similar to those in Canada, France and Germany due to employment falling more slowly than GDP.