Germans are more productive than us, work less, and earn more

“It takes a German worker four days to produce what we make in five. British workers are putting in longer hours for lower pay.”

Phillip Hammond, 23 November 2016

On average, it actually takes German workers about four and a half days to make what a UK worker makes in five.

It takes them less than four hours to make what we make in five hours but, on average, we work for about 5 hours and 48 minutes longer than them each week.

And most UK workers earn less per hour than most German workers.

The UK’s productivity gap

In the Autumn Statement, the Chancellor spoke about the “productivity gap” between the UK and other developed countries, and between London and other UK cities.

On average, an hour worked in other G7 countries produces 18% more than an hour worked in the UK.

At the same time, every hour worked in London produces something that would sell for 30% more than the average across the UK as a whole.

‘Productivity’ isn’t just about how hard people work. The OECD says it’s about ”working smarter”, rather than “working harder”.  

People think it can be improved by investment in things like infrastructure, education, management and technology. For example, you’d be more productive if your boss bought you a faster computer, even if you put the same amount of effort into your job.

The Chancellor said that was why the government plans to borrow money to fund infrastructure and innovation.

Unfortunately, there’s no single answer on exactly how to solve the UK’s “productivity puzzle”, as the Bank of England put it, or exactly why it exists. It’s likely to be multiple factors at play. We’ve talked some of these issues in the past.