The severe slowdown in economic growth has had an immediate impact on the Euro Area’s productivity performance, as lower investment and less innovation has made workers less productive.
According to the latest estimates by The Conference Board output-per-hour growth in the Euro Area has dropped off to 0.6 percent in 2012. While in part related to the slowing long-term trend, Europe’s productivity performance has been even more negatively affected by the crisis.
At the same time, as labor cost rapidly declined in several of the most troubled economies in Europe, the cost competitiveness of those economies has significantly improved during the crisis.
Are these unit labor cost realignments the beginnings of structural changes as a result of the crisis? Or do they represent strongly different growth models within Europe, which now come clearly to the forefront? How different is Europe’s productivity performance from the rest of the world?
What can policy makers do to revert Europe’s slowing trend in productivity, especially in times of crisis, and how to avoid negative impacts on job creation?
- Bart van Ark, Executive Vice-President and Chief Economist, The Conference Board
- Bert Colijn, Labour Market Economist, Europe, The Conference Board
- Chair - Carlo Altomonte, Non Resident Fellow, Bruegel
- Discussant - Zsolt Darvas, Research Fellow, Bruegel
- Venue: Bruegel, Rue de la Charité 33, 1210 Bruxelles
- Time: 8 April 2013, 12:30am - 14:00am
- Contact: matilda.sevon[at]bruegel.org