POID Special Report - Cracking the Productivity Code: An international comparison of

Exhibit II: Productivity levels relative to the UK Notes: The darkest bar is the difference in value added per hour worked between the UK (100%) and the relevant countries. [...] The left bar of each variable (labour productivity, labour composition, capital intensity and TFP) is the average weighted annual growth rate in the pre-GFC period (1995-2007), and the corresponding right bar is the average weighted annual growth rate in the post-GFC period (2007-2019). [...] The weighted decline in capital intensity growth is only -0.36% in the US (half of that in the UK), -0.28% in Germany and -0.15% in France. [...] Figure B17 presents the growth accounting results for the four sectors that con- tributed the most to the UK’s slowdown.10 In Manufacturing and Professional services, the decline in TFP growth accounts for over three-fifths of the slow- down. [...] The labour 38 AN INTERNATIONAL COMPARISON OF UK PRODUCTIVITY service and capital service volume indices in Germany are missing before 1991, and we rely on the growth rates of labour service and capital service in 2012 EUKLEMS for the extrapolation of the respective time series before 1991.