British productivity
Against a positive economic backdrop in recent quarters, one blot on the British economy’s copybook has been the continuing dismal performance of productivity. Output per hour worked remains below its pre-crisis peak and productivity growth has been substantially weaker than in the United States and other large European countries over the same period. (See Figure 20.)
It is difficult to blame membership of the European Union for this productivity weakness and there are 2 principal factors lying behind it. First, it has, in part, been driven by the divergent performances of the services and industrial sectors. While services output is now back above its pre-crisis peak, industrial output still remains well below it. (See Figure 21.)