by Alasdair Macleod, Gold Money:
In the media warm-up for Wednesday’s UK budget, we were told of Britain’s poor productivity and Chancellor Osborne subsequently confirmed that his priority is to address it.
Comparative figures for Europe quoted by the BBC were sourced from the OECD and are replicated in the chart below. It represents GDP per hour worked, using the US dollar on a purchasing power parity basis across different EU nations. And it shows the UK as lagging other European countries badly, which presumably is why the Chancellor feels the need to act.
These statistics are misleading. France is shown as even more productive than Germany, which cannot be true. France’s unemployment is at 12% and private sector employment is only 62% of the OECD’s “economically active population”. This is not a productive economy. Furthermore the public sector is 57% of GDP, compared with 44% for the UK.
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