UK productivity tumbles as working from home takes hold

UK productivity tumbled in the first three months this year as coronavirus forced workers into their homes.

Official stats from the Office of National Statistics showed labour productivity fell by 0.6% from January through to March compared with the same period a year ago.

Output per worker was down by 3.1% over the same period, reflecting the impact of the government’s job retention scheme, under which furloughed workers still count as employed for statistical purposes.

The ONS said about the stats: "This reflects the impact of "furlough" schemes, which reduced hours worked but preserved workers' employment statuses."

Labour costs jumped by 6.2%, its fastest rate since 2006, also as a result of the furlough scheme.

Productivity fell across the whole economy. Output per hour was hardest hit in the property sector, with a slump of 10.5%.

Productivity was a major problem for the UK economy even before coronavirus struck. The UK has some of the worst worker output rates in the developed world, with many economists blaming a lack of investment in skills and IT by senior managers and executives.