Alternative measures of labour productivity

Labour productivity is most appropriately measured as a volume of output generated per hour worked. However the number of persons employed (i.e. total employment) is often used as a proxy for labour input, in particular, when data on total hours worked cannot be estimated.

Key findings

International and inter-temporal comparisons of labour productivity can differ depending on the measures of labour input used. For example, higher incidence of part-time employment in Germany and the Netherlands, or lower statutory hours, for example in France, are likely to result in lower international rankings of labour productivity for these countries, when calculated on a head-count basis, compared with measures based on hours worked. The opposite is true for countries with longer statutory hours or average working weeks (like Costa Rica, Chile, Eastern European economies, Mexico, South Africa and Turkey), or with a lower incidence of part-time employment (Eastern European countries, the Russian Federation and South Africa).

Over the period 2001-2017, GDP per hour worked increased more rapidly than GDP per person employed in nearly all countries, partly reflecting a higher incidence of part-time employment.

Definition

Total employment is measured as the total number of persons engaged in production, including both employees and self-employed. Hours worked refer to the total number of hours actually worked, whether paid or not, by both employees and self-employed. They reflect regular hours worked by full-time and part-time workers, paid and unpaid overtime, hours worked in additional jobs, excluding time not worked because of public holidays, annual paid leaves, strikes, labour disputes, bad weather, economic conditions, among other reasons (Chapter 8. ).

Comparability

Variations in working patterns (e.g. part-time vs full time employment) and employment legislations (e.g. statutory hours) across countries and over time affect the time consistency and cross-country comparability of total employment figures, justifying, when possible, the use of total hours worked as a measure of labour input.

The preferred source for total employment is OECD National Accounts Statistics (database). For some countries, however, longer time series and/or more recent estimates need to be derived from the OECD Employment and Labour Market Statistics (database), the OECD Economic Outlook: Statistics and Projections (database) and national statistics office websites (Chapter 8. ).

References

OECD Economic Outlook: Statistics and Projections (database), http://dx.doi.org/10.1787/eo-data-en.

OECD Employment and Labour Market Statistics (database), http://dx.doi.org/10.1787/lfs-data-en.

OECD National Accounts Statistics (database), http://dx.doi.org/10.1787/na-data-en.

OECD Productivity Statistics (database), http://dx.doi.org/10.1787/pdtvy-data-en.

Figure 2.9. GDP per hour worked and GDP per person employed, 2017
As percentage of the OECD average (OECD=100), current prices and current PPPs
Figure 2.9. GDP per hour worked and GDP per person employed, 2017

 StatLink http://dx.doi.org/10.1787/888933968421

Figure 2.10. Growth in GDP per hour worked and growth in GDP per person employed, 2001-2017
Total economy, percentage change at annual rate
Figure 2.10. Growth in GDP per hour worked and growth in GDP per person employed, 2001-2017

 StatLink http://dx.doi.org/10.1787/888933968440

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