Labour productivity falls in latest stats report

Labour productivity fell 0.7 per cent in the year ending March 2016, StatsNZ said in a report today. Labour inputs increased 3.3 per cent, which is the largest seen since the series began in 1996. Labour productivity in general has increased by 30 per cent in the last 20 years. “A growing labour market saw a record rise in labour available to produce goods and services,” national accounts senior manager Gary Dunnet said. “This strong labour market growth, and annual output growth of 2.8 percent, led to a fall in labour productivity.” Multifactor productivity decreased 0.4 per cent as input growth eclipsed the output. Multifactor productivity, according to StatsNZ, “captures the effects of unobserved inputs such as technological progress, efficiency gains, and economies of scale.” Capital productivity was flat, up 0.1 per cent, as capital inputs rose in line with output growth. In terms of labour productivity by industry, the retail trade, which includes the sale of motor vehicles, had increased 5.3 per cent between 2014 and 2015. Productivity for transport, postal and warehousing, however, fell 3.7 per cent in the same period. Labour productivity in the financial and insurance services remained stagnant, up 0.5 per cent. The capital-to-labour ratio index for retail trade was up 1.2 per cent between 2014 and 2015. The transport, postal and warehousing industry fell 4.1 per cent, with financial and insurance services up 3.4 per cent.