Interesting how productivity declined consistently from the moment Labour came to office.

Interesting that your forecast increase to 2014 exactly mirrors the decline from 2014.

I was going to ask the same question.

What on earth happened from 97-08, leaving the crash aside?

@ 1 and 2

Oh dear. If you actually look at the graph, I think you’ll find that productivity grew by an average of around 2% during Labour’s reign.

@3

Oh dear, if you actually look at the graph you will see that it is a rolling 5 year average.

So the 97 reading – around 2.4% – would be the final five years of Tory govt.

Downhill from there…

If you are conflating full and part-time jobs would it not make more sense to use productivity in terms of GDP per hour worked? The UK does slightly better on this measure compared to the per worker basis. Anyway they may be underestimating future productivity growth. Until the recession the UK had the fastest growing productivity in the G7- 1991-2007 40 percentage points on the per worker measure. On the per hour measure the growth was 44 percentage points 1991-2009. This was also the fastest G7 growth. Other than the coalition immigration policies there is no reason why the former productivity growth trajectory can’t be continued.
http://www.statistics.gov.uk/cci/nugget.asp?id=160

Moreover, what is probably implied in the OBR employment forecasts but not explicitly stated is the effect of the depreciated real effective exchange rate on unit labour costs. Without suffering a nominal wage cut British workers are working for a lower real wage, they just do not realise it.

@ 4

Could you kindly point out that bit of the graph that shows a decline in productivity? Hint: a ‘decline’ means negative growth. Y’know, a minus number. I must be looking straight past it…

Oh for goodness sake, a decline in the rate of growth…

Either way, the Lab average is well below 2.

Sorry you missed the “5 year annualized” bit.

@ 7

I did miss the annualized bit. Sorry you missed the “a rise isn’t a decline” bit.

A decline in productivity GROWTH, sure. But that’s a different kettle of fish and a suddenly distant set of goalposts, isn’t it?

I never used the word “decline” BTW, that was #1.

Distant but important, given the power of compounding.

“I never used the word “decline” BTW, that was #1.”

I know, but you said you were going to ask the same question so I replied to both of you. You’ve actually sort of picked up astateofdenmark’s error rather than making it yourself.

“Distant but important, given the power of compounding.”

Fair enough. I don’t know the specific causes, but the decline doesn’t fit onto the years of Labour government as tightly as you’re making out. Growth stops rising in ’96; until ’99/’00 we’re still talking about an assessed period that mostly happened under a Tory administration. Labour probably do have something to do with it, though, most likely because they’re focused on social justice rather than economic efficiency.

*Oh, one other thing. The Tories give tax breaks to firms and rich individuals, with short-term benefits. Labour puts money into education and so forth, with long-term benefits. You shouldn’t actually expect to see all the benefits of a Labour administration for a decade or so.

1 – I don’t suppose the media put much store in what the OBR has been told to say by George Osborne. (I know too many Treasury officials to have any faith in the OBR and to see it as anything but damaging that actual independent experts are leaving the Treasury as they feel as though their work is being degraded)

2 – for those wondering about productivity falling under Labour – this tends to happen when employement rises. After all, there tend not to be large number of highly skilled, well educated unemployed people to take up new jobs that are more productive than the average across the economy.