Britain's productivity outlook

Dr Dan Coffey featured in the Financial Times on 7 July 2021, in a letter describing Britain's productivity outlook as a mixed blessing.

Senior Lecturer in the Economics Division Dan Coffey commented on the revisions to data by the Office for National Statistics on Britain’s producitivty levels as a ‘mixed reassurance’. 

The data shows that Britain’s productivity levels were lower than originally thought prior to the 2008 banking crisis, and there had been a secular decline in the index over a number of decades. Dr Coffee added that data explains why productivity outputs had not appeared to bounce back at the level expected post 2008 in line with Okun’s Law - and while the revisions answer some questions, a longer run view would be needed. He added:

It is unclear if the latest revision, including an upgrade on the performance of telecommunications, fully resolves this issue, while a British economy that achieves record breaking employment levels in what is still a context of very low labour productivity growth remains a historically striking phenomenon.

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