In 2016, labour productivity in information industries was higher than in other industries in the non-agricultural business sector in almost all OECD countries – and as much as one-and-a-half times higher in Israel and Turkey. This reflects the relatively higher investment by information industries in machinery and equipment, as well as knowledge-based capital such as software and Research and Development.
The labour productivity of information industries varies among countries for reasons including the roles different countries play in global value chains (many products of information industries are highly tradable) and variations in the weight of the different components of information industries (e.g. ICT manufacturing and services). Large differences in productivity relative to the rest of the economy contribute to very high ratios of labour productivity in information industries compared to other industries in India (nearly 5 to 1), Costa Rica and Israel. In contrast, the high ratio in the United States (over 2 to 1) reflects a focus on relatively higher value-added activities, while in Korea (2 to 1) it is indicative of the strength of ICT manufacturing. Conversely, the relatively low ratios observed in countries such as Switzerland and Norway are linked to high average levels of productivity in other industries.
In Finland, the Netherlands and Austria, labour productivity levels in ICT manufacturing are markedly higher than those in information and communication services, and about twice those of the rest of the economy. This suggests concentration in high value added ICT manufacturing such as advanced components. In contrast, the comparatively low productivity levels of ICT manufacturing in Poland and Estonia suggest that these countries are hubs for more simple ICT products.
Understanding the drivers of productivity growth requires an awareness of the contribution made by each industry (OECD, 2017a). Between 2006 and 2016 – a decade during which productivity growth slowed in most countries due to the Great Recession – the contribution of information industries remained generally positive. However, this contribution varied among OECD economies, with the highest relative contributions (more than half of the total) occurring alongside robust overall productivity increases in Sweden, the United States and Germany. In France, Finland, Italy and Norway, meanwhile, productivity growth in information industries compensated for weak or negative growth in the rest of the economy.
In Sweden, the United States and Ireland, content and media industries contributed relatively strongly to productivity growth. In many countries, telecommunication and information services also provided notable contributions. In most cases, this corresponded to a fast expansion of ICT services, accompanied by employment growth, while in telecommunications it resulted chiefly from a strong reduction in employment.
