France, Germany and the UK Similarities, differences and prospects

1
France, Germany and the UKSimilarities,
differences and prospects

• This research is funded by the European
  Commission, Research Directorate General as part
  of the 6th Framework Programme, Priority 8,
  "Policy Support and Anticipating Scientific and
  Technological Needs".

2
France, Germany and the UK Large share of EU
value added

France
Germany
UK
EU-15
EU-10
Developments in these countries important in
understanding EU productivity
3
France, Germany and the UKSimilarities
deceleration or no change in labour productivity
growth....in contrast to acceleration in US

• Growth in value added per hour worked
• per annum, 1970-95 versus
  1995-04

France
Germany
UK
US
4
Similarities Acceleration in labour productivity
in electrical machinery, post and communications

• Growth in value added per hour worked
• per annum, 1970-95 versus
  1995-04

France
Germany
UK
US
5
Similarities acceleration in percentage points
contribution of ICT capital to output growth

• ICT capital contribution
• pp per annum, 1970-95 versus 1995-04

France
Germany
UK
US
6
Similarities poor performance in MFP growth
relative to US

• Growth in Multifactor productivity
• Market Economy per annum

France
Germany
UK
US
7
Differences France and UK show increase in
person engaged, 1995-04, but not Germany

• Growth in persons engaged
• per annum

France
Germany
UK
US
8
Differences Industry location of productivity
gainsFrance MFP growth success in traditional
manufacturing, big decline in UK

• Growth in multi-factor productivity, per annum
  

France
Germany
UK
US
9
Differences Industry location of productivity
gains MFP growth success in UK in Financial and
Business services, big decline in Germany

• Growth in multi-factor productivity, per annum
  

France
Germany
UK
US
10
UK very large contribution to EU ICT capital
growth

• Contributions to ICT capital growth,1995-04
  

Value added shares
UK
UK
11
France relatively successful in traditional
manufacturing and in raising the employment rate
overall

But employment growth in market services
associated with static MFP growth
12
GermanyDownturn in labour productivity growth
not compensated by increase in employment
Germany has maintained growth in value added in
manufacturing

US
But concerns over labour force skills - share
high skilled workers sluggish compared to other
countries
UK
France
Germany
13
France, Germany and the UK Prospects

• UK Shows some signs of following US lead in
  reaping benefits from ICT
• France No immediate signs of a US style
  productivity growth acceleration
• Germany Prospects of US style growth spurt are
  dim
• Better prospects for an acceleration in other EU
  countries such as the Netherlands, Ireland and
  Finland but small share of EU value added
• European productivity revival may be held back by
  some larger economies, including Spain and Italy