Press Statement

Preasráiteas

25 July 2019

Ireland’s Labour Productivity Growth for 2000-2017 at 3.9% is above the EU average of 1.3%

Go to release: Productivity in Ireland 2017

The Central Statistics Office (CSO) has today (25 July 2019) published Productivity in Ireland 2017. This publication presents a comprehensive picture of productivity and economic growth in the Irish economy for the Domestic and other sector, and the Multinational Enterprise (MNE) dominated Foreign-sector since 2000. A separate analysis is also presented for twenty individual economic sectors in the economy.

Productivity measures the efficiency with which an economy transforms inputs into outputs. Throughout this publication, the CSO has emphasised the need to separately assess productivity in the MNE dominated Foreign sector from productivity in the Domestic sector. To enable this analysis all indicators are presented for the economy as a whole and with separate results for the Foreign sector and the Domestic and other sector. This reduces the risk of a misinterpretation of these results and an exaggerated understanding of the trends in Productivity in Ireland, once we look beyond the MNE dominated sectors.

Increases in productivity growth are generally associated with improvements in living standards. However, in the case of the Irish economy a note of caution must be sounded because of the high concentration of foreign-owned MNEs. There are many instances of very high productivity growth that result in a limited spillover into the Domestic and other sector of the economy and in turn to Irish households.

Commenting on the figures, Michael Connolly, Senior Statistician said:

“The results in this publication are based on the continued work by the CSO to assist users in understanding the impact that the highly globalised nature of the Irish economy has on productivity measures.
In this publication, the analysis by economic sector has been extended to a twenty sector model of the economy. In addition, productivity in the Market sector of the economy is separately measured. Further research has resulted in a new chapter presenting experimental results on a Gross Output basis (KLEMS) which relates productivity changes to changes in inputs of energy (E), materials (M) and services (S) along with changes in factor inputs of capital (K) and labour (L). A Quality Adjusted Measure of Labour Input or (QALI), supplied in the economy has also been included, that takes into account the education, age and gender composition of the work force. These new measures, are the result of ongoing research and will require further analysis before being fully integrated into the main productivity indicators presented in this publication. Nevertheless, all the data, both the experimental KLEMS and QALI together with the more standard measures of Labour Productivity and Capital Services and Multi-factor Productivity are available in the CSO StatBank interactive tables. We look forward to a meaningful engagement with our stakeholders, once these results have been fully considered, to set priorities for future productivity analysis.”

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