Date lodged: 1 June 2016
To ask the Scottish Government for what reason the Scotland Performs' webpage has recorded figures showing that Scotland's OECD productivity ranking has "worsened" from 16th place in 2006 to 19th currently.
Answered by: Keith Brown 14 June 2016
The evaluation of progress towards the Scottish Government's productivity purpose target is based on any change in Scotland's productivity rank among organisation for economic co-operation and development (OECD) member countries. In 2006, Scotland was ranked 16th in the OECD for productivity levels in terms of output per hour worked. Between 2006 and 2010 Scotland's ranking fluctuated between 16th and 18th, and has remained at 19th since 2011.
In real terms, output per hour worked in Scotland has grown by 4.5% between 2006 and 2014. Over the same period, output per hour worked in the UK as a whole has grown by only 1.6% in real terms.
Scotland's productivity ranking relative to the OECD members is influenced by a range of external factors, such as real productivity growth in Scotland and other OECD countries, each country's rate of price inflation, and changes in currency exchange rates. Since 2010, Scotland’s ranking has been largely influenced by reduced purchasing power in the UK as a whole relative to other OECD members. This relates to the depreciation of Sterling relative to other currencies since the onset of the global financial crisis around 2008, and the consequent OECD benchmarking of purchasing power parities in 2011.
Further explanation of how purchasing power parities can impact on relative productivity rankings in the OECD is contained in the Scotland performs technical note for the productivity purpose target, which is available at the following address: http://www.gov.scot/About/Performance/scotPerforms/TechNotes/productivity