Productivity overview, UK: October to December 2022

• Growth in output per hour worked in Quarter 4 (Oct to Dec) 2022 was flat (0.0%) compared with Quarter 4 2021.

• Output per worker and output per job in Quarter 4 2022 were respectively 0.2% and 0.3% lower than the same quarter a year ago.

• Relative to the same quarter a year ago, construction and administrative service industries had the biggest positive industry contribution to annual productivity growth.

Quarter 4 (Oct to Dec) 2022 completed four quarters without the furlough. Therefore, for the first time in a post-coronavirus (COVID-19) period, we can compare quarter on quarter from a year ago without the distortion of furlough effects.

Output per hour worked, our headline measure of labour productivity, was flat (0.0%) in the four quarters to Quarter 4 2022. Growth in gross value added (GVA) (0.5%) was balanced closely by growth in hours worked (0.6%) over the past year.

Output per worker and output per job were 0.2% and 0.3% below their respective Quarter 4 2021 levels. This is because of higher growth in the number of workers (0.8%) and jobs (0.9%) than in the GVA (0.5%).

Output per hour worked was 2.1% above its pre-coronavirus pandemic levels (2019 average level) in Quarter 4 2022. This growth was driven by a fall in the number of hours worked (1.6%) and an increase of GVA by 0.5% (see Figure 1) since 2019. Output per worker and output per job were also above their pre-coronavirus pandemic levels, at 0.4% and 0.2% respectively. This was because of a higher increase in GVA (0.5%) compared with the growth in the number of workers (0.0%) and the number of jobs (0.3%).

Figure 2 shows the contribution to annual growth in output per hour worked for 17 industries in Quarter 4 (Oct to Dec) 2022 relative to the same quarter a year ago. Construction and administrative service industries made the biggest positive industry contribution to annual productivity growth. By contrast, manufacturing and wholesale and retail industries detracted from productivity growth. The mining and quarrying industry did not make any contribution to productivity growth over the same period.

Figure 3 shows that hotels and catering and construction industries saw the largest increase in output per hour worked in Quarter 4 2022 compared with Quarter 4 2021, mainly driven by an increase in gross value added (GVA). Other services (a residual category, including personal service activities not covered elsewhere in the Standard Industrial Classification (SIC) 2007) had the biggest falls in Quarter 4 2022 compared with Quarter 4 2021. This was mainly driven by the decrease in GVA.

Labour productivity

Labour productivity measures how many units of output are produced for each unit of labour input, and is calculated by dividing output by labour input.

Labour inputs

The preferred measure of labour input is hours worked ("productivity hours"), but workers and jobs ("productivity jobs") are also used.

Output

Output refers to gross value added (GVA), which is an estimate of the volume of goods and services produced by an industry, and in aggregate for the UK.

Methodological information

Productivity estimates and their inputs are produced to a number of decimal points as reported in the linked datasets. However, within the bulletin we have rounded to one decimal point.

Information on the strengths and limitations of the data, as well as the quality and accuracy of the data, is available in the Labour productivity Quality and Methodology Information (QMI).

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