Productivity growth down but still ahead of most

Productivity growth down but still ahead of most

SINGAPORE - Singapore's manufacturing labour productivity growth slowed sharply last year, but the gains were still ahead of those in other developed economies, says the United States Department of Labor.

But Singapore's competitiveness was severely blunted by a sharp rise in its unit labour cost (ULC) in US dollar terms, boosted by a stronger Singapore currency, according to the Labor Department in its latest international comparisons of manufacturing productivity and unit labour cost trends.

Only the Czech Republic and Singapore experienced productivity (output per hour) growth of 8 per cent or higher in 2011, while in 2010 the majority of countries experienced growth that exceeded 8 per cent, it said.

While Singapore's productivity gains plunged last year, it came after a big jump of 35 per cent in 2010, the largest increase among the 19 economies tracked by the department's Bureau of Labor Statistics.

The next biggest increase trailed far behind at 18.6 per cent, posted by Sweden.

For 2011, only the United Kingdom had productivity growth higher (4.5 against 4.4 per cent) than in the previous year; productivity gains were smaller or dropped in the other 18 economies.

"(Manufacturing) labour productivity rose by more than 2 per cent in the majority of countries," the Labor Department says. "These productivity increases were generally driven by gains in output coupled with modest changes in hours."

Productivity growth in the Czech Republic, still a developing economy, eased from 13 per cent in 2010 to 10.1 per cent - the biggest gain last year. Singapore's was the second largest.

Australia, where productivity tumbled 4 per cent, was the worst performer. Productivity also dropped in Finland (-0.1 per cent), Italy (-0.4 per cent) and Japan (-2.8 per cent).

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