Communication services and finance and insurance lead labour productivity growth in 2010

In the March 2010 year, labour productivity for the measured sector increased 3.5 percent, Statistics New Zealand said today.

This rise was driven by strong labour productivity growth in the goods-producing sector (up 3.8 percent) and the service sector (up 3.3 percent). Labour productivity is the amount of goods and services produced by each worker. The declines in labour input were greater than that for output, resulting in labour productivity growth for these sectors. Labour input declines in 2010 were the strongest in manufacturing, construction, and business services.

The communication services and finance and insurance industries showed the highest growth in labour productivity in 2010.

“Multifactor productivity (MFP) for the finance and insurance, and communication services industries also showed strong growth for the 2006–10 period. However, overall measured sector MFP decreased 0.7 percent a year over this period,” productivity statistics manager Peter Gardiner said. The main drivers for the decrease in measured sector MFP were the construction and manufacturing industries (down 3.7 percent and 2.6 percent a year, respectively).

MFP measures how effectively existing resources such as workers and capital are used to produce goods and services.

Productivity statistics are available for 24 industries, called the measured sector, which covers approximately 80 percent of the economy. Excluded are government administration and defence, health, and education.