OUR PRODUCTIVITY PROBLEM

Philip Hammond in his autumn statement last week lamented Britain’s poor productivity:

“The productivity gap is well known, but shocking nonetheless. It takes a German worker four days to produce what we make in five, which means, in turn, that too many British workers work longer hours for lower pay than their counterparts.” 

Is that really true? Are our Nissan and Jaguar plants really 25% less efficient than German car plants? I doubt it. The problem is that productivity’s a tenuous means of measuring performance. Apparently we lag all G7 countries apart from Japan for productivity and our performance rather than improving has stayed flat over the past decade. GDP per hour worked seems a loopy way of assessing things because when I was working fulltime I reckoned my contemporaries worked much harder than their French, American and German counterparts. It was only in heavily unionised businesses like the film industry that productivity was really held back.

On a personal level I’m very concerned about my wife’s productivity. She seems to be working harder and harder despite my reducing the housekeeping budget in view of the current economic uncertainty and a reduction of “narrow money”. In other words less GDP per hour worked. Her productivity gap is shocking and she refuses to accept my solution that by doing less we’ll improve our productivity. Indeed when I mention productivity now she gets quite shirty and hands me a tea towel.

So the solution to this “national problem” is for us to reduce the number of hours we work. In the UK the number of hours worked per head per annum has gone down by just 1.5% in the past 15 years (it’s down 6% in Germany). The Germans work 18% less than we do - yes a whopping 18% fewer hours.

The original definition of Parkinson’s Law was this:-
"Work expands so as to fill the time available for its completion."

So if follows if we worked less we’d produce about the same and our productivity would shoot up; as an economist might say - “sorted.”

Sathnam Sanhera wrote about the “gig economy” last week. This is where people do things other than just for money or proper money for the job done. Like speakers at conferences and virtually all writers. If an author were to apply a minimum hourly rate for their work no one would ever publish their work. Yet our world is full of wannabe writers. According to a report from the International Publishers Association UK publishers released 184,000 new and revised titles in 2013. That’s 2,875 titles per million inhabitants, and places the UK 1,000-plus titles ahead of second-placed Taiwan and Slovenia with the US publishing only 959 titles per million inhabitants.

So we work too much, we charge too little for our work and we spend too much time writing books.
We don’t actually have a real productivity problem at all. As my wife so aptly said it’s just another piece of claptrap.