Productivity: are we keeping up with Germany?

“It takes people in Germany four days to produce what people in the UK take five days to produce. And that means that they can pay themselves better, or they need to work fewer hours [...] This is a long standing challenge of the British economy…”

Greg Clark MP, 23 November 2017

On average, UK workers were 26% less productive per hour than German workers in 2016.

So it took German workers around four hours to produce what UK workers did in five hours.

Workers in the UK work longer days on average than German workers. This pushes up the amount each UK worker produces in total. So overall, UK workers were 8.5% less productive than German workers in 2016.

The gap between the two countries was wider in 2015 when it took German workers less than four hours to produce what UK workers did in five hours.

And, as Mr Clark says, most German workers earn more per hour than most UK workers (at least, they do according to figures from 2014).

‘Productivity’ isn’t just about how hard people work. The OECD says it’s about efficiency and innovation too. ”Working smarter”, rather than “working harder”.  

People think it can be improved by investment in things like infrastructure, education, management and technology. For example, you’d be more productive if your boss bought you a faster computer, even if you put the same amount of effort into your job.

Unfortunately, there’s no single answer on exactly how to solve the UK’s “productivity puzzle”, as the Bank of England put it, or exactly why it exists. It’s likely to be multiple factors at play. We’ve talked some of these issues in the past.