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Guide to: Productivity Measures

Released: 24 August 2011 Download PDF

Productivity measures are essential in assessing the efficiency, competitiveness and underlying ‘potential’ rate of growth of an economy.

There are a number of data release and methodology publications on the ONS website, which can be accessed through the productivity page.

The Office for National Statistics (ONS) headline labour productivity measure is output per worker for the whole economy. Other published productivity measures are output per filled job and output per hour worked which are available for the whole economy and selected industry sections and sub-sections.

Both unit labour costs and unit wage costs are available for the whole economy and measure the labour or wage cost of producing one unit of output. Although not a direct measure of productivity, an inverse relationship between these measures and productivity tends to be observed: the higher the productivity of a worker, the lower the cost of labour per unit of output, and vice versa.

Other data published in the Labour Productivity Statistical Bulletin include an experimental market sector productivity series and annual regional productivity estimates by Government Office Region.

The International Comparisons of Productivity (ICP) release publishes data on the UK productivity performance in comparison with other G7 countries. While these estimates use the same definition as above, they use different data sources to ensure consistency and comparability.

ONS also publish experimental series and related articles on multi-factor productivity (MFP) and its necessary components, capital services (VICS) and quality adjusted labour input (QALI).

In 2007, ONS published the ONS Productivity Handbook which describes the range of productivity estimates, compares different methods of assessing productivity, outlines and reviews methodological aspects of productivity estimates and the components that are used to derive productivity estimates, and so on. An extensive glossary of productivity related terms can be found in the Productivity Handbook. 

 

Technical Information

The output measure used to calculate productivity is the chained volume measure of gross value added (GVA) at basic prices, sourced from the ONS National Accounts. The three whole economy input measures used (workers, filled jobs and hours worked) are sourced from the Labour Force Survey (LFS). An industrial allocation of filled jobs is achieved by using workforce jobs data where the employee component is on a reporting unit (RU) basis. An industrial allocation of hours is constructed by multiplying jobs filled by average hours from the LFS.

Whole economy unit labour costs are the ratio of total labour costs per worker to output per worker.

Regional productivity estimates are produced annually, and are at the Government Office Region level since there are currently no volume measures of regional GVA. Regional productivity results are in nominal terms and presented as indices where UK=100.

Market sector workers are calculated by taking LFS workers less public sector workers. Market sector hours are then calculated by multiplying market sector jobs by average hours from the LFS. These labour input series are used to calculate output per worker and output per hour using GVA for the market sector.

Labour input series which show seasonality are seasonally adjusted before use in productivity estimates.

There are a number of data release and methodology publications on the ONS website, which can be accessed through the productivity page. In 2007, ONS published the ONS Productivity Handbook which describes the range of productivity estimates, compares different methods of assessing productivity, outlines and reviews methodological aspects of productivity estimates and the components that are used to derive productivity estimates, and so on. An extensive glossary of productivity related terms can be found in the Productivity Handbook.

Source: Office for National Statistics

Background notes

  1. 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



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