Tag Archives: Productivity

The impact of e-commerce on the consumer sector- view from a Bank of England Agent

Tim Pike.

The internet’s share of UK retail sales is – at 12% – the highest in the developed world.   In my daily conversations with businesses and services, I find that some sectors are responding much more nimbly to the competition from internet retailers than others.  In this blog I argue that the growing share of internet retailing is likely to reduce business investment, especially in buildings, but the additional capacity associated with internet retailing is likely to be a drag on retailers’ profitability that may last for many years.  In my view the long-term effect on capital productivity should be positive, but the effects on labour productivity are less obvious and may be adverse.

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Filed under Macroeconomics

Skills matter: The changing workforce and the effects on pay and productivity

Matthew Corder

Pay and productivity growth over the past couple of years have remained weak despite a rapid fall in unemployment and robust GDP growth.  But these aggregate measures in the UK reflect the sum of a diverse range of individuals in the workforce.  Changes in the mix of that workforce, therefore, can affect pay and productivity growth.  Based on analysis of the determinants of individual workers’ wages, I estimate that changes in the mix of the workforce may account for about 1pp of the recent weakness in annual average pay growth relative to normal. Continue reading

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Filed under Macroeconomics, Monetary Policy