What The UK’s Low Productivity Is Really Telling Us

by John Aziz

This, I would argue, is one of the scariest charts in the world today. The green line is output per hour worked, and the dotted green line is the pre-crisis trend:

[…] It’s what the Bank of England calls the “UK productivity puzzle.” As the BBC’s Linda Yueh notes: “output per hour is around 16 percentage points lower than it should be if productivity had grown at its pre-crisis pace.”

I don’t think it should be called a “productivity puzzle”. That would imply that we don’t really understand the phenomenon. That the phenomenon is a puzzle. But it’s really a simple phenomenon. The phenomenon is that people are producing less output per hour than they were before the financial crisis. Work is getting done. But the quality of the work is not improving.

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