Guide to: international comparisons of productivity

ONS International Comparisons of Productivity (ICP) are based on two productivity measures for all G7 countries (Canada, France, Germany, Italy, Japan, the UK and the US). These two productivity measures are gross domestic product (GDP) per worker and GDP per hour worked. These are calculated using both current and constant purchasing power parities (PPPs).

The current PPP approach estimates the differences in productivity levels across the G7 countries for any particular year. These data are indexed so that the UK=100 for all years, which enables the productivity gap with another country to be measured.
It is recommended to use these data to compare difference in productivity levels only and not to compare productivity growth. Users should note that differences of a few percentage points should not be seen as significant.

The constant PPP approach, which was introduced for the first time in the October 2007 ICP First Release, allows users to compare productivity growth – i.e. changes over time – across the G7 countries. These data should only be used for comparing growth and not for assessing differences in productivity levels. The data are indexed such that 2004=100 for all countries, allowing comparisons of productivity growth to be made with 2004 as a reference period. As with the current PPP approach, differences of a few percentage points should not be seen as significant.

The production of the ICP figures was handed over to ONS in 2001. The GDP per hour worked series was made a National Statistic in February 2006, following an Organisation for Economic Co-ordination and Development (OECD) quality assurance review of the hours worked data. All ICP statistics published by the ONS are now National Statistics.

It is important to note that these comparisons are not wholly consistent with the domestic labour productivity data produced by ONS. The headline measure of whole economy productivity for the UK uses gross value added (GVA) as the measure of output, whereas ICP are based on GDP. This is because the use of PPPs, which enables international comparisons, is compatible with GDP data only.

Source: Office for National Statistics

Background notes

1. For more details on the methodology that underpin the calculation of ICP figures, consult the article “International comparisons of productivity: the current and constant PPP approach (246.1 Kb Pdf) ”, published in the August 2007 edition of Economic and Labour Market Review.
   
2. For more details on the analysis of past revisions consult consult “ International comparisons of productivity: an update to understanding revisions (267.3 Kb Pdf) ” , published in the 2008 and " A technical note on revisions and interpretation (243.7 Kb Pdf) ", published in 2005.

3. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gsi.gov.uk

Further information