Wage growth has outpaced productivity growth, contributing to higher labour costs compared to regional peers

2021 ◽  
Keyword(s):  
Productivity Growth ◽  
Wage Growth ◽  
Labour Costs

International Differences in Manufacturing Unit Labour Costs

1995 ◽  
Vol 154 ◽  
pp. 85-110 ◽  
Author(s):  
Mary O'Mahony
Keyword(s):  
Productivity Growth ◽  
The United States ◽  
Minor Role ◽  
Nominal Wage ◽  
Market Exchange ◽  
National Accounts ◽  
Competitive Position ◽  
Labour Costs ◽  
Unit Labour Costs ◽  
Time Changes

This article presents measures o f competitiveness in manufacturing comparing Britain to Germany, France and the United States. Data from the National Accounts and the Census of Production are combined to derive new estimates of relative unit labour costs for a number of manufacturing industries. The results show that British manufacturing had a competitive advantage over Germany and France in 1993. This arose primarily from the devaluation of Sterling and followed a period, from 1989 to 1992, when unit labour costs in British manufacturing were generally close to those in Germany and France. Unit labour costs in American manufacturing, however, were considerably lower than in the European countries in 1993. The results by industry show that Britain performs relatively poorly in much of the engineering sector while being relatively more competitive in consumer goods industries. Over time changes in the market exchange rates and nominal wage inflation have large impacts on the relative competitive position of total manufacturing in the four countries whereas productivity growth plays a minor role. However, at the industry level productivity growth is important. In the face of similar movements in relative nominal wages across industries, differences in productivity performance distinguish those British industries which gained ground over their rivals abroad from those whose competitive position worsened.

scholarly journals Assessment of the state of social and labor sphere of rural areas in the Ural Federal District

2020 ◽  
Vol 176 ◽  
pp. 06006
Author(s):  
Victoria Kalitskaya ◽  
Andrey Pustuev ◽  
Olga Rykalina ◽  
Irina Perminova ◽  
Olga Mustafina
Keyword(s):  
Human Capital ◽  
Labor Productivity ◽  
Productivity Growth ◽  
Rural Areas ◽  
Agricultural Sector ◽  
Analytical Data ◽  
Wage Growth ◽  
Federal District ◽  
The State ◽  
Number Of Factors

The article presents the author’s calculations of the labor sphere state of rural areas of the Ural Federal District (Russia). It is substantiated that labor (human) capital is the most important element of ensuring the functioning of the entire agrarian sphere. The estimation of labor productivity in the agricultural sector, the rate of wage growth, as well as relative social and labor indicators of the agricultural direction to the general economic is conducted. The authors consider the ratio of agrolabor productivity growth and decrease in the number of workers in this sphere, which is associated with a number of factors, resulting in the construction of a system of sociolabor factors interaction contributing to the development of rural areas, based on analytical data

scholarly journals Why Does Trend Growth Affect Equilibrium Employment? A New Explanation of an Old Puzzle

2012 ◽  
Vol 102 (4) ◽  
pp. 1378-1413 ◽  
Author(s):  
Michael W. L Elsby ◽  
Matthew D Shapiro
Keyword(s):  
Productivity Growth ◽  
Wage Growth ◽  
Employment Rate ◽  
Combined Effects ◽  
Reservation Wages ◽  
Returns To Experience ◽  
New Evidence ◽  
Trend Growth

That the employment rate appears to respond to changes in trend growth is an enduring macroeconomic puzzle. This paper shows that, in the presence of a return to experience, a slowdown in productivity growth raises reservation wages, thereby lowering aggregate employment. The paper develops new evidence that shows this mechanism is important for explaining the growth-employment puzzle. The combined effects of changes in aggregate wage growth and returns to experience account for all the increase from 1968 to 2006 in nonemployment among low-skilled men and for approximately half the increase in nonemployment among all men. (JEL E24, J24, J31)

scholarly journals Jacks of All Trades and Masters of One: Declining Search Frictions and Unequal Growth

2021 ◽  
Vol 3 (3) ◽  
pp. 339-352
Author(s):  
Paolo Martellini ◽  
Guido Menzio
Keyword(s):  
Labor Market ◽  
Productivity Growth ◽  
Wage Growth ◽  
Fast Growth ◽  
Search Frictions ◽  
Minimal Growth ◽  
Growth Differential ◽  
Differential Returns

Declining search frictions generate productivity growth by allowing workers to find jobs for which they are better suited. For “jacks of all trades”—workers whose productivity is similar across different jobs in their labor market—declining search frictions lead to minimal growth. For “masters of one trade”—workers whose productivity varies a great deal across different jobs in their labor market—declining search frictions lead to fast growth. A rudimentary calibration suggests that differential returns to declining search frictions may account for a non-negligible fraction of the wage growth differential between routine and nonroutine workers. (JEL J24, J31, J63, J64, O33)

The UK Economy

1994 ◽  
Vol 150 ◽  
pp. 10-28
Author(s):  
Carry Young
Keyword(s):  
Growth Rate ◽  
Productivity Growth ◽  
Price Inflation ◽  
Capital Costs ◽  
Exchange Rate Mechanism ◽  
Labour Costs ◽  
Unit Labour Costs ◽  
Retail Prices ◽  
The Uk ◽  
Rate Mechanism

Price inflation in the UK economy has remained below the expectations of most commentators since sterling left the exchange-rate mechanism in September 1992. Latest estimates of inflation indicate that retail prices are now growing at an annual underlying rate of 2 per cent; the lowest growth rate for 27 years. This impressive performance is being sustained by very low growth in labour and capital costs, unit labour costs are estimated to have fallen by 1/2 per cent in the last year, as fast productivity growth has been combined with low growth in earnings.

Growth-promoting reforms in Estonia will take time

2016 ◽  
Keyword(s):  
Productivity Growth ◽  
Baltic States ◽  
Content Type ◽  
Baltic Countries ◽  
Labour Costs ◽  
Catch Up ◽  
Growth Promoting ◽  
Per Capita ◽  
The Baltic ◽  
The Eu

Subject Recent sluggish growth rates in Estonia. Significance Estonia has traditionally been the wealthiest of the three Baltic countries, but now Lithuania has caught up with it in terms of per capita GDP. The Estonian economy has grown more slowly than those of the other two Baltic states, in particular because of lacklustre productivity growth. Impacts Despite continuing emigration, the Latvian and Lithuanian economies are forecast to grow more vigorously than Estonia's in the coming years. Unit labour costs will continue to rise in Estonia, as wage growth exceeds productivity growth. Slower growth in the Baltic states will still exceed the EU average, allowing catch-up with more affluent countries. Firms and households may have learned their lesson regarding very rapid debt growth, judging by the Baltics' very small external imbalances.

scholarly journals Updated Notes on the Interindustry Wage Structure, 1890–1990

ILR Review ◽  
1995 ◽  
Vol 48 (2) ◽  
pp. 305-321 ◽  
Author(s):  
Steven G. Allen
Keyword(s):  
Productivity Growth ◽  
Wage Growth ◽  
Capital Intensity ◽  
Union Density ◽  
Wage Structure ◽  
Manufacturing Industries ◽  
Strongly Correlated ◽  
Previous Time ◽  
Profit Growth

The author documents and analyzes changes in wage structure across manufacturing industries over the years 1890–1990. Interindustry differentials in wages were highly stable over that period for production workers, but much less stable for nonproduction workers. Interindustry wage patterns were very similar for production and nonproduction workers in 1990, though this similarity dates back only to 1958. Although dispersion of wages across industries followed varying trends over the period, it was higher in 1990 than at any previous time in this century. The variables that have been most strongly correlated with wage growth are productivity growth, rising union density, rising capital intensity, and profit growth.

scholarly journals On the Effects of InterSector Productivity Growth Differences on Sectorial Inflation in the Baltic States Relative to the Euro Area

Ekonomika ◽  
2006 ◽  
Vol 76 ◽  
Author(s):  
Lina Bukevičiūtė
Keyword(s):  
Euro Area ◽  
Productivity Growth ◽  
Growth Pattern ◽  
Transition Period ◽  
Wage Growth ◽  
Baltic States ◽  
New Member States ◽  
Tradable Sector ◽  
Growth Differences ◽  
The Baltic

The ability of the Baltic States to damp the growth of inflation might partly depend on the scale of the Balassa-Samuelson (BS) effect. In recent years, inflation was lower in the Baltic States as compared to the beginning of the transition period. This raises the question whether the BS impact on inflation is still relevant. Based on an empirical assessment, this paper aims to provide some recent evidence concerning the productivity growth pattern in the tradable and non-tradable sectors in the new Member States vis-a-vis the euro area. Thus, the paper analyses whether the main assumptions in the Balassa-Samuelson effect of a higher growth of productivity in the tradable sector and a higher wage growth in the non-tradable sector have come true.

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