Britain more productive than before Covid-19 crisis

Britain is even more productive than it was before the Covid-19 crisis struck, reveals official figures released today.

The UK produced 2.3 per cent more goods and services per hour worked compared to before the pandemic, according to figures from the Office for National Statistics (ONS).

Each worker is capable of producing 0.8 per cent more products than they were in February 2019, the ONS said.

The fresh estimates provide early signs the UK is tackling its so-called entrenched “productivity puzzle” that has plagued the country’s economy since the financial crisis.

Persistently low levels of productivity growth have choked the country’s growth rate for more than a decade, contributing to widening regional economic inequality.

Despite gains in productivity, the actual amount of value workers add to the production process dipped 0.2 per cent.

Productivity statistics have been skewed during the pandemic due to the furlough scheme masking real levels of productivity in the economy.

Highly-skilled workers that tend to be more efficient were more able to rapidly pivot to home working practices, while less productive workers were more likely to be furloughed, meaning they dropped out of the ONS’ calculations.

As a result, average productivity levels were artificially boosted by the ONS’ measure mainly capturing the efforts of more efficient workers.

Hours worked in the UK were unchanged over the last quarter despite the end of the furlough scheme in October, indicating Brits who took on the hours of furloughed people who work fewer hours returned those hours.