The UK – The World’s Second Least Productive Advanced Economy?
According to new figures released by the Office of National Statistics (ONS) on the 18th of February 2016, things aren’t looking too good for British productivity.
Looking at the 2014 financial year, output per hour here in the UK was 18% lower than the average for other G7 advanced economies, forming the largest productivity gap since estimates began in 1991.
So, more bad news for the construction industry then? Well, not quite.
While it’s true that productivity (GDP per hour worked in this case) was lower than that of Canada, Italy, the US, France and Germany, with only Japan lagging behind us, things are a little different if we look specifically at construction, which is – after all – the most important industry!
Using the measure of GVA per hour worked, with the UK being given a baseline figure of 100, the construction industry really holds its own on the world construction stage, in fact, we’re second only to the US, which is 36 percent ahead.
Meanwhile, our labour force is more productive than Germany by some margin (24 percent in fact) and things also look positive compared to France and Italy, which show very similar figures to the UK.
Now, chances are that you aren’t a statistician, and neither am I, so what does all of that mean?
Well first off, things aren’t as terrible as they might at first appear, but that doesn’t mean that we can sit back and relax. While it’s all well and good being in the top tier when it comes to worldwide construction productivity levels, that’s not really enough.
Let me put it this way, if you’re a foreign investor looking to put some cash into a construction project, how do you choose where to build or invest? Do you choose the country that’s suddenly pulled out all the stops and made a phoenix-like return? After all, what is there to say it won’t experience another dip before you can make a profit?
However, what if you see that one of those places has made consistent improvements over the years? The stable choice certainly seems like the best one.
To attract more investment into UK construction we need to do exactly that, push for a more productive industry to make the UK stand head and shoulders above the rest, and make it last.