This is a very ominous chart. UK labour productivity has declined sharply over the last year. In the second quarter, productivity was down four percent compared to a year earlier.The reason is straightforward; people in work aren't producing as much. In order for firms to remain profitable, workers will have to receive less wages or employment will have to fall.
so what is it going to be? My guess is that we will soon see a sharp rise in unemployment.
Labour productivity has always been in decline.
ReplyDeleteI don't know why anyone bothers voting for them.
Does labour "productivity" equal less profits being made?
ReplyDeleteI thought they managed all this stuff by "balancing" and managing unemployment with the interest rate level?
Alice - not only a rise in unemployment but a drop in wages for those in work and increases in tax.
ReplyDeleteWhat does that add up to... a massive drop in living standards.
Couple that with interest rates having to rise (to get investment in the UK) and there is only one way that property prices can go - south - big time !
It would be interesting to see this split public/private sector.
ReplyDeleteMy guess is that the private sector is as productive as ever, perhaps even increasing, but since their numbers are contracting, the overall average shows a fall as the always less-productive public sector becomes progressively more exposed in the numbers.
This cannot go on, but the solution is not what you suggest - it's that the size of the public sector HAS to be reduced drastically. In theory public-sector productivity could be increased to take up the slack, but if you believe that will happen, then I have a bridge you might be interested in buying.
My guess is that the private sector is as productive as ever, perhaps even increasing
ReplyDeleteI would guess not - Most working people I know have known for quite some time that they are doomed career-wise and are actively looking for alternatives to working their behinds off so their bosses can meet objectives and get bonuses!
A couple of mass-layoffs and the ever persistent threats of outsourcing have reinforced that feeling to the point of colleagues openly job-hunting during work hours.
Forgot - of course - to mention the obvious growth in parasitic activities that are regarded as "jobs" but just leach resources from useful tasks: "Human resources departments", "gender/diversity-sensitivity seminars", "SCRUM"- "LEAN"- whatever-the-latest-fad consluttants in abundance, trillions of pieces of statistics that must be produced for gubmint to make power-point slides off e.t.c.
ReplyDeleteWe know it is not sustainable but we must see the world as it Is and not as it should be!
Both !
ReplyDeletethis chart is shown that UK labor productivity continuously decline, Every year labor productivity decrease, workers will have to receive less wages or employment will have to fall.
ReplyDelete