The economist Paul Krugman once said, “Productivity isn’t everything, but in the long run, it’s almost everything”. When workers can produce more value in the same amount of time, economies can grow faster, and living standards can rise.
What you should know about this indicator
This data is adjusted for inflation and differences in living costs between countries.
This data is expressed in international-$ at 2021 prices, using a multiple benchmark approach that incorporates PPP estimates from all available benchmark years.
USA, Germany and UK are leading in productivity.
What surprises me at first glance is that China, in particular, is so far behind. The latest figures are from 2023, so things have certainly changed since then. However, the main reason for China's low productivity is probably that, alongside high-tech products, they also produce a large number of goods of a relatively low standard. The proportion of cheap products relative to high-quality products is still very high there compared to the USA or Europe.
more countries added
Adding more countries paints a different picture. Ireland, Norway, Switzerland, and Denmark then occupy the top spots. Ireland's inclusion on this list is initially puzzling. However, it becomes clearer when you consider that many corporations, especially American ones like Google, Apple, and others, have their European headquarters in Ireland. These branches generate enormous revenues and profits with a small workforce. And that's precisely why these companies have chosen to locate there. They pay significantly less tax in Ireland on profits earned within the EU than if their headquarters were in Germany, France, or Spain. Furthermore, English is widely spoken in Ireland, which simplifies communication with headquarters in the US.
Norway likely benefits from its abundant oil reserves, which translates into high wages and a high standard of living. Switzerland is known for its high-quality products and benefits from the many international organizations headquartered there, resulting in correspondingly high salaries. And, not least, it's also an international financial center and banking hub, with Zurich at its heart. Denmark is home to such well-known companies as Novo Nordisk, Vestas, Carlsberg, and Ørsted.
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Translation with Google, Deepl // Not financial advice, just my humble opinion
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