More New Zealanders working, and working smarter

More New Zealanders working, and working smarter

22 February 2018

New Zealand’s labour productivity rose 0.9 percent in the year ended March 2017, Stats NZ said today. Growth in the workforce saw labour inputs for the measured sector increase 2.9 percent, while the economy expanded 3.8 percent.

Labour productivity measures the quantity of goods and services (output) produced for each hour of labour.

“The latest figures show that New Zealand workers could produce 133 goods or services each hour in 2017, compared with 100 an hour 20 years ago,” national accounts senior manager Gary Dunnet said.

Labour productivity is one of the three major productivity measures produced; the other two are multifactor productivity and capital productivity. Both multifactor and capital productivity also rose in the year ended March 2017. Multifactor productivity rose 1.0 percent for the year, reflecting the effects of unobserved inputs such as technological progress, efficiency gains, and economies of scale.

In the long run, productivity is regarded as key to increasing New Zealand’s standard of living – as workers share the fruits of their labour. By producing more for each hour worked, their incomes may rise and the country becomes wealthier.

Growth in labour productivity in goods-producing industries was up 1.6 percent in the year ended March 2017, boosted largely by 3.9 percent growth in labour productivity in the construction industry. Service industries recorded labour productivity growth of 0.8 percent in aggregate over the year, while primary industries (agriculture, forestry, fishing, and mining) collectively recorded a 0.6 percent decline.

Multifactor productivity was also higher in good-producing industries, up 2.0 percent in 2017. This compares with 0.9 percent growth in service industries and a 1.8 percent decline in primary industries.

Ideally, productivity measures should cover all industries in the economy but the industry coverage of these statistics includes only the ‘measured sector’ (ie mainly market industries). However, this still covers approximately 80 percent of New Zealand’s economy.

For more information about these statistics:

• Visit Productivity statistics: 1978–2017

• See CSV files for download

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