NBS: Labour Productivity Rose to N684.43 in 2016

Labour productivity rose from N471.94 in 2011 to N684.43 in 2016, representing a 45.0 per cent increase over the six-year period and a decline of 4.7 per cent between 2015 and 2016.

The National Bureau of Statistics (NBS) said in its 2016 Q4 2016 Labour Productivity report stated that labour productivity increased to N783.51 in Q4, 2016 from N713.77 in Q3, N636.30 in Q2, N605.27 in Q1 and N706.95 in Q4, 2015.

Therefore, for the period under review, labour productivity increased by 9.8 per cent on quarterly basis and 10.8 per cent year-on-year.

The estimated total number of hours worked increased by 0.48 per cent between Q3 and Q4, 2016, and increased 1.9 per cent between Q4, 2015 and Q4, 2016.

The report noted that the fourth quarter (Q4) of 2016 which saw a rise in labour productivity represented the highest levels since Q1 2015.

However, while the overall level of productivity was high, there were several challenges that generally impacted on output and labour, and indirectly on labour productivity, keeping it below optimal levels.

Some of these issues faced during the quarter were issues that spilled over from Q1 through Q2 and Q3, 2016.

The report pointed out that in the review period, investment in the economy was still relatively low, though some government investments were recorded during the quarter, adding that the volume of private investment and foreign direct investments were still considerably low compared to previous years.

Power was relatively stable during the quarter, which partly accounted for the increase in labour productivity but was still lower than the required levels, the NBS said.

Although there was a contraction in the economy in Q4 in real terms, which was accompanied by an increase in the unemployment rate, the growth in labour productivity implies a gradual increase in labour efficiency employed in the economy, the third consecutive quarterly rise.

Labour productivity refers to the quantity of labour input required to produce a unit of output, although it is recognised that labour is not the only input utilised in the production process.

High labour productivity can be an important signal of the improvement in real incomes (wages of labour). It also has implications for the conduct of both monetary and fiscal policies.

It is recognised that labour productivity is not necessarily an indicator of the effort of each worker, but it still provides a useful measure of the rewards to labour as a factor in the production process.