Ian Billett and Patrick Schneider.
As time goes to infinity, the probability that a productivity analyst will wonder ‘which sectors are driving these trends?’ goes to one. We present an interactive sectoral productivity tool to help you explore this question without any fuss.
What is productivity?
Labour productivity is defined as real value-added (£ worth of output created) per labour unit (number of employees) for the set of relevant sectors (up to whole economy).
How do I use the tool?
It’s as simple as choosing the sectors and clicking ‘plot’: our tool will show the path of productivity for an economy or just the selected sectors. You can plot as many lines as you like, and also define the time period you’re interested in by drawing and resizing a grey box in the graph below the main chart, which will update like magic. To see which sectors are included in a line, hover over its colour in the key below the chart; to clear it, click that colour box.
What can I use it for?
You might wonder, for example, whether the productivity puzzle remains after excluding the financial sector. To investigate this, select all sectors except ‘Finance and insurance’ in the menu below the chart and click ‘Plot’; and you will see that the puzzle does, in fact, remain.
The possibilities are almost endless (with 20 options and at least one selection, there are 1,048,575 combinations to choose from), so we’ll leave it to you from here.
Screenshot, click for live version
Note that the aggregation affected by the tool isn’t strictly accurate because we’re adding up CVM series, which are non-additive. A full analysis would account for the fact that volume measures of UK GDP are annually chain-linked up to the current reference year (2013), which we recommend you do for deeper analysis.
The data are quarterly, SIC07 section level aggregate real value-added and productivity jobs (with government sectors apportioned by LFS weights), available from the Office of National Statistics at the links.
Ian Billett works in the Bank’s Technology Division and Patrick Schneider works in the Bank’s Structural Economic Analysis Division.
If you want to get in touch, please email us at bankunderground@bankofengland.co.uk or leave a comment below.
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If Labour unit is defined by number of employees, then these metrics are likely to be somewhat misleading due to the increasing frequency of part-time working and ZHC Contracts.
The Labour measure should be the actual number of Hours worked, regardless of whether they are paid or not ( Unpaid work being a significant factor for UK employees due to “give/back” and presenteeism ).
Have you given the proper definition for Labour Unit?
If you have, do you agree with my concerns over its relevance, taking into account variability of hours worked per employee ( full time vs. part-time ) and the prevalence of unpaid “additional hours” in the UK?