OFFICIAL figures released yesterday showed the fastest increase in productivity in the UK for two years, adding to hopes that real wages will begin to rise again after years of decline.
Output per hour worked rose by 0.7 per cent in the final quarter of 2013, compared to the same period last year, following six quarters of decline. Similarly, output per job and output per worker rose at its strongest pace since late 2011.
Across the economy, output per hour is still down one percentage point from 2010 levels, according to the Office for National Statistics (ONS). In finance and insurance, it is still down 8.3 per cent.
“The extent to which the weakness in the UK’s productivity has been structural rather than cyclical has vital implications for the economy’s growth potential and for policy,” said IHS Global Insight’s Howard Archer.
He added: “If productivity fails to pick up appreciably over the coming quarters, it indicates that the economy has less potential to grow without generating inflationary pressures.”