IS THE UK PRODUCTIVITY SLOWDOWN UNPRECEDENTED?

Nicholas Crafts and Terence C. Mills

National Institute Economic Review, 2020, vol. 251, R47-R53

Abstract: We estimate trend UK labour productivity growth using a Hodrick-Prescott filter method. We use the results to compare downturns where the economy fell below its pre-existing trend. We find that the current productivity slowdown has resulted in productivity being 19.7 per cent below the pre-2008 trend path in 2018. This is nearly double the previous worst productivity shortfall ten years after the start of a downturn. On this criterion the slowdown is unprecedented in the past 250 years. We conjecture that this reflects a combination of adverse circumstances, namely, a financial crisis, a weakening impact of ICT and impending Brexit.

Date: 2020
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Working Paper: Is the UK Productivity Slowdown Unprecedented? (2019)
Working Paper: Is the UK Productivity Slowdown Unprecedented? (2019)
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