Recent productivity trends and transformations in Italy's production system

Antonio Accetturo (), Audinga Baltrunaite (), Emanuele Ciani (), Federico Cingano (), Federica Daniele (), Roberta De Luca (), Irene Di Marzio (), Rosalia Greco (), Andrea Linarello (), Francesco Manaresi () and Sauro Mocetti
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Antonio Accetturo: Bank of Italy
Audinga Baltrunaite: Bank of Italy
Emanuele Ciani: Bank of Italy
Federico Cingano: Bank of Italy
Federica Daniele: Bank of Italy
Roberta De Luca: Bank of Italy
Irene Di Marzio: Bank of Italy
Rosalia Greco: Bank of Italy
Andrea Linarello: Bank of Italy
Francesco Manaresi: Bank of Italy

No 953, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: Between 2019 and 2024, the Italian economy recorded GDP growth that exceeded both the euro-area average and that of the previous five-year period. The expansion was mainly driven by the private sector, where value added increased by nearly 10 per cent, largely benefiting from a generous fiscal stimulus. Growth was concentrated in construction and services, while manufacturing slowed. It was fuelled by rising employment, while labour productivity declined over the past two years. The productive system saw an increase in the average firm size (which remains below the euro-area average), as well as in profitability and investment propensity. Firm-level productivity was supported by reallocation and internal growth processes, by multinational companies, and by the dynamism of firms at the productivity frontier. However, the gap between the most efficient firms and the rest of the productive system widened. To close the productivity gap with major European countries – and in light of recent signs of weakening – the production system will need to be strengthened more broadly, and fostering a wider adoption of advanced technologies will be crucial.

Keywords: labour productivity; economic growth; employment; firm demographics; firm size (search for similar items in EconPapers)
JEL-codes: D20 L20 O40 (search for similar items in EconPapers)
Date: 2025-07
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