What is productivity and why is the U.K.’s so poor?

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The Guardian – Larry Elliot 

Published: December 25th, 2016

Difficulty rating

Rating: 3 out of 5.

Credibility rating

Rating: 3 out of 5.


This article is centered around productivity. It explains how productivity is measured, ways productivity can be improved, and its effects on an economy. It explores the U.K.’s low and deteriorating productivity levels and discusses several possible reasons for this. It then moves onto the U.K.’s proposed solutions to its productivity issues.


Larry Elliott is an English journalist and author who focuses on economic issues. He is the economics editor at The Guardian and has published seven books on related issues.


  • The Office for National Statistics (ONS): This is the executive office of the U.K. Statistics Authority, a non-ministerial department that reports directly to the U.K. Parliament.

Analysis of Potential Bias

The author used a very credible source to support some of his points. However, in some parts of the article, the author gives his opinions that are not backed by any economic experts and passes them off as facts.

Article Decryption

Productivity is basically a measure of what goes in and what comes out in a country. Technically, it measures how much output is gotten from one unit of resources e.g. labour. It is easier in some sectors to measure productivity than in others.

There are many productivity improvement strategies a firm can take:

  • Acquiring new machinery,
  • Hiring highly skilled workers,
  • Providing intensive training for workers, etc.

Productivity improvements are required for living standards to rise. !Productivity is a key source of economic growth and competitiveness. A country’s ability to improve its standard of living depends almost entirely on its ability to raise its labour productivity i.e. output per worker.

The Office for National Statistics publishes an international comparison of productivity, which shows that since 2007 productivity in the U.K. has almost stagnant, and the gap with the rest of the G7( the U.S., Japan, Germany, France, Italy, and Canada) widened by 18%. Explanations for the deterioration of productivity include the availability of unskilled cheap labour has deterred firms from investment; the poor quality of UK roads, railways and broadband network; the shrinkage of the financial sector, which had been a source of high-productivity jobs in the boom before the 2007 crisis etc.

The U.K. government stated that improving productivity is the “central long-term economic challenge” for the U.K. former chancellor Philip Hammond identified better infrastructure, technology, and skills as the foundations for improving productivity and unveiled a £23bn national productivity investment fund.

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