Employee productivity the lowest in 2009
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siliconindia | Thursday, 21 January 2010, 07:44 IST

Bangalore: The output of employees in advanced economies fell in 2009 for the first time in more than 40 years, as the global economic crisis hit companies' output, according to the annual report on productivity from the Conference Board. The report says that worldwide output per worker will jump 2.2 percent this year after the deepest global recession in six decades caused a one percent slide in 2009, the first since 1991's 0.1 percent dip, reports Finfacts Ireland.
The report states that U.S. employers had layed off workers and kept labour productivity rising, while unemployment in Europe rose much less, with the consequence that productivity plunged. Germany for example had more than one million workers in its subsidized part-time work scheme. Output per hour of work rose in the United States by 2.5 percent in 2009 while productivity was fell by one percent on average in the Eurozone.
The Conference Board said the gap would narrow in the current year but the United States would still outperform much of the Eurozone. Economists forecast that productivity would strengthen to three percent in the United States in 2010 and return to positive growth of two per cent in the Eurozone. "These are unusually large differences in productivity growth between the United States and Europe. U.S. employers have reacted much more aggressively to the recession than their European counterparts in terms of cutting jobs and hours." said Bart van Ark, Chief Economist for the Conference Board, a private sector group, based in New York.
While productivity will improve this year, Van Ark said a jobless recovery is both Europe and the U.S. is "the most likely scenario." Emerging economies, led by China, can expect jobs, employment and productivity to continue to grow in 2010. "Emerging economies are becoming global competitors to be reckoned with on the basis of high productivity growth, not just because of low cost," he added.
The report claims that productivity actually fell by an estimated 3.8 percent in Russia in 2009 and was down 3.2 percent in Turkey while rising by an estimated 3.9 percent in India and 8.2 percent in China. China's productivity growth is projected to be 7.7 percent this year. Irish and Spanish productivity rose last year, to 1.5 percent and 3.8 percent, respectively, mainly reflecting the recession.