EU labor productivity index declines 1.2 points

RP news wires, Noria Corporation

The retrenchment of labor productivity gathered pace throughout the European Union during December, as signaled by the seasonally adjusted Markit EU Productivity PMI posting 45.1, down from 46.3 in November. The reading signaled not only a series-record deterioration in EU productivity, but also the 11th successive monthly decline in output per worker within the European single market.

 

On a national level, each of the big-four EU economies posted the steepest falls in output per worker in their respective series histories and, while the downturn in productivity remained steeper across the Eurozone, the United Kingdom also posted a series-record decline in its output/labor ratio. Italian firms again posted the steepest falls in overall, manufacturing and services productivity of the big-four EU economies in December. Companies operating in the German private sector extended their current run of falling productivity to five months. The latest drop was the fastest in the series history and, while manufacturers recorded by far the steeper drop, both monitored sectors’ labor productivity ratios fell at unprecedented rates.

 

The U.K. registered record falls in labor productivity during December. Nonetheless, the losses recorded were markedly weaker than across the European monetary union. The composition of the fall was in contrast to the trend seen throughout the Eurozone, with broadly similar declines recorded for both services and manufacturing productivity.

 

On a sector level, the economic downturn had a considerable impact throughout the European Union. Of the 23 monitored industries, 21 posted falls in output per worker during December. Moreover, 11 of those sectors reported the steepest falls in labor productivity in their respective

series histories. Only the Pharmaceuticals and Telecommunications sectors reported rises in output per worker during December.

 

The joint-steepest declines in productivity were signaled in Metals, Mining & Steel and Chemicals, followed closely by the Capital Goods and Healthcare sectors.

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