Labour productivity rises 0.5 percent

Labour productivity rose 0.5 percent in the year ended March 2021, Stats NZ said today.

"The rise in labour productivity reflects labour inputs declining by more than the fall in output over the March 2021 year," national accounts industry and production senior manager Ruvani Ratnayake said.

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

Rises were also seen in multifactor productivity, which rose 0.7 percent, and capital productivity, which rose 1.0 percent.

Multifactor productivity captures the effects of unobserved inputs such as technological progress, efficiency gains, and economies of scale. Capital productivity measures the amount of economic output generated per unit of capital investment in things like land, buildings, machinery, and equipment.

The COVID-19 pandemic and associated response measures have had a range of impacts on productivity in New Zealand, with different experiences seen across industries.

Labour productivity in both the primary and service industries rose, up 4.0 percent and 0.7 percent respectively, in the March 2021 year. By contrast, labour productivity in goods-producing industries fell 1.4 percent over the same period.

In theory, productivity measures should cover all industries in the economy. The coverage of these statistics only include the measured sector, which is mainly market-sector industries. This covers approximately three-quarters of New Zealand's economy.

Predominantly non-market service industries like education and healthcare are not included within the measured sector.

Data for the year ended March 2021 is provisional and subject to revision.