Falling productivity due to changes in employment patterns
As per my previous post, I don’t believe there’s much of a mystery when trying to match the UK’s ‘robust’ employment patterns with its falling productivity.
As we can see from the table below, over the last 12 months we have seen falls in the number of full-time employees while employment growth has remained strong due to increases in part-time employees and self-employed workers. Unpaid workers and government training schemes have also helped.
Self-employed workers are no less productive than employees (indeed they may be more so) but the ONS numbers present a picture of workers either becoming part-time to retain/get jobs or losing their jobs and becoming self-employed rather than unemployed. This helps to explain why productivity and hence economic growth has been weak over the last year but the last three months of employment data shows a more optimistic picture with the number of full-time employees growing by 51,000 indicating a willingness to hire again.
This will be one of my last blog posts at this address. I’ll soon be moving to my new home on the savills.co.uk research page (details to follow).