CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

UK productivity below G7 average

Article By: ,  Financial Analyst
September 21, 2015 3:36 PM

Official figures have shown that the UK's productivity was lower than the rest of the G7 countries in 2014.

According to the Office for National Statistics (ONS), the country's output per hour in 2014 was 20 per cent lower than the G7 average. This represents the biggest lag since 1991 when the ONS started making comparisons.

The figures put the UK significantly behind the US, Germany and France in terms of productivity. According to the report, workers in these countries were 32-33 per cent more productive than those in the UK. For example, it would take a UK worker four hours to produce the same work done by a German in three hours.

Italy was ten per cent more productive than the UK, while Canada was four per cent more productive. The only G7 country to score worse on productivity was Japan – it was 15 per cent behind the UK.

ONS chief economist Joe Grice said that the figures show how UK productivity "continues to lag behind other developed economies".

He added: "Since the economic downturn, productivity growth has slowed in most developed economies, but by more in the UK than the average."

Living standards

Many experts believe that improving productivity can help to increase living standards.

Economist Howard Archer told the BBC that British productivity had been down since the financial crisis due to the creation of many low-skilled and low-paid jobs where productivity is limited.

Others believe that the focus should be on agility, rather than productivity.

James Sproule, chief economist at the Institute of Directors explained: "The economy of the future looks set to be dominated not by big companies, but by fast, agile, quick-moving and reactive ones."

He added that when firms can respond to customer demands effectively and bring new products and services out quickly, the market will "reap the rewards".

BBC analyst Andrew Verity pointed that improving productivity shouldn't be about workers working harder. He says that investment – in plant, machinery, skills and public infrastructure - is much more decisive in improving how much each worker produces.

He also noted that data from the ONS in July indicated a sharp pick-up in the UK's productivity, which coincided with an increase in investment. "But if we're going to catch up with the rest of the G7, we'll have to sustain that for years," he added.

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024