Despite years of research and investment into the problem, the productivity of New Zealand's workforce still shows no signs of meaningful improvement.

The latest annual productivity statistics, for the year ended March 2020, show labour productivity grew by a sluggish 0.6 percent. 

While that is an improvement on 2019, the rate at which productivity is growing has slowed in the past decade.

Between 2011 and 2020, labour productivity increased by 8.9 percent; in the 2000s – a decade that encompassed the GFC – it grew by 12 percent.

Productivity growth in NZ has lagged behind richer OECD countries for decades and to catch up the rate of growth needs to increase.

Labour productivity measures the output (in goods and services) per hours worked. 

Improving productivity is widely considered to be the key to increasing real wages and ultimately living standards.

It's not just a measure of how hard people work, but also the value of what they produce, which can fluctuate in world markets.

Sector breakdown

The primary sector and services sector generated 2.4 and 1.5 percent gains in the 12 months to March 2020, respectively.

Made with Flourish

Over the decade both sectors were up about 12 percent.

The goods-producing sector has tended to be the worst-performing of the three main sectors in the economy, which suggests manufacturers are throwing more people at the production process or investing poorly in new machinery that would increase productive output.

In this sector, productivity actually decreased by 1.7 percent in the 12 months to March and is up just 1.8 percent for the decade. 

No covid impact

The statistics are largely free of economic disruption as a result of covid-19 restrictions, most of which were implemented in late March and beyond.

Any impact from covid-19 will become apparent in next year's release.