ONS Recommends Real-Time Indicator for Accurate UK Productivity Measurement
ONS Shifts Focus to Real-Time Indicator for Productivity Analysis
Background and Recommendation
LONDON, June 16 (Reuters) - Britain's statistics office on Tuesday recommended people look at a newer measure of productivity that uses tax office data rather than the longer-running series based on its labour force survey that has suffered from low response rates.
The Office for National Statistics' so-called real-time indicator measure — introduced in August 2024 — shows faster productivity growth, with output per worker up 4.2% since 2019, compared with a 2.3% increase on the older labour force survey measure.
Expert Commentary
"The historic lower response rates for the LFS lead us to recommend, at the current time, that users focus on the experimental RTI approach as the best estimate of how productivity is changing in the UK economy," ONS Deputy Chief Economist Richard Heys said in an ONS blog post.
Key Points and Comparisons
Productivity Growth Trends
- British productivity growth slowed after the 2008 global financial crisis, and problems with the LFS— which is also used to calculate unemployment — have worried the Bank of England
- Response rates for the LFS had returned to near pre-pandemic levels, but past shortfalls in responses were affecting annual growth rates, the ONS said
- The ONS said its advice to focus on the RTI productivity measure did not apply to other data based on the LFS
Recent Data Insights
- RTI data showed output per hour worked grew by an annual 2.1% in the first quarter of 2026 versus a 0.4% rise in the LFS measure
- The RTI measure of staff on company payrolls has shown bigger falls in employment than the LFS survey, boosting measured productivity
Future Developments
The ONS is working on a new productivity measure that combines RTI and LFS data with another survey of employers, with initial estimates due around the end of the year
(Reporting by David Milliken; Editing by Alex Richardson)
