Economy
Productivity Productivity
growth remains steady Whole economy productivity and
unit wage costs annual growth UK productivity growth
in the second quarter declined slightly when compared
with a year ago but accelerated when compared with
the previous quarter.
In the second quarter of 2003, annual productivity
growth for the whole economy was 1.8 per cent, little
changed from the 2.0 per cent achieved in the previous
quarter. This was because output growth was unchanged
when compared with the previous quarter, while job
growth was slightly stronger.
Care has to be taken in making comparisons with the
second quarter of 2002, when activity is likely to
have been impacted by the Jubilee holiday. Compared
with the previous quarter, productivity growth was
0.4 per cent, up from no growth in the previous quarter.
This was primarily due to a pick up in the quarterly
rate of output growth to 0.5 per cent, compared with
0.2 per cent in quarter one of 2003.
Annual manufacturing productivity growth improved
for the fifth consecutive quarter, and at 5.9 per
cent, was its highest rate since the 5.9 per cent
recorded in the first quarter of 2001.This was due
to a combination of stronger manufacturing activity
alongside continued job cuts. Compared with the previous
quarter, manufacturing productivity grew by 2.1 per
cent in the second quarter of 2003, an improvement
from growth of per 1.0 per cent in the previous quarter.
This was due to a recovery in output. The output indices
used in the calculation of productivity in this release
are the first to be calculated using chain linking,
and as a result the figures quoted here are not directly
comparable to earlier releases. Unit wage costs for
the whole economy grew by 1.2 per cent in the second
quarter of 2003 compared to a year ago.
It was the lowest rate since the 0.8 per cent growth
recorded in the first quarter of 1996. This was due
to a deceleration in the growth of wages and salaries.
For similar reasons, overall manufacturing unit wage
costs showed an annual decline of 2.9 per cent, down
from 1.5 per cent in the previous quarter.
