Output growth and productivity growth are different measures. Output counts what was made, while productivity divides it by the inputs used.
This lesson is part of cost and productivity from a supplied table. If productivity itself is new, read explaining productivity first.
How do I test a table for productivity growth?
Follow three steps each time.
- Find the output and the number of workers (or hours) for each year.
- Divide output by workers to get output per worker in each year.
- Compare the two results, and only then claim a rise or a fall.
If the question asks “by how much”, convert the change to a percentage of the earlier year.
Worked example: a fictional packing factory
| Year 1 | Year 2 | |
|---|---|---|
| Boxes packed | 5 000 | 6 000 |
| Workers | 20 | 30 |
| Boxes per worker | 250 | 200 |
Output rose from 5 000 to 6 000, which is (6 000 − 5 000) ÷ 5 000 × 100 = 20% growth.
Output per worker fell from 250 to 200, which is (200 − 250) ÷ 250 × 100 = a 20% fall.
The workforce grew by 50%, from 20 to 30, while output grew by only 20%. The extra workers made the total larger but each one produced less.
How do I write the explanation?
Use a frame: “Output rose by (figure) but workers rose by (figure), so output per worker fell from (A) to (B). The extra output came from adding inputs, not from using them better.”
For the factory: “Output rose by 20%, but workers rose by 50%, so output per worker fell from 250 to 200 boxes. The extra output came from hiring more workers, not from each worker producing more.”
A possible cause to add, if the question asks why: the new workers may still be learning, or the packing line may be crowded. Mark it as a possible reason, since the table does not prove it.
The mistake that costs marks
The common slip is to write “output increased, so productivity increased”. It equates two measures that the table separates.
A second slip is dividing by the wrong year’s workers. Keep each year’s output with that year’s workers, and never mix them.
Check yourself
A fictional farm cooperative harvested 8 000 kg with 16 pickers last season and 9 000 kg with 15 pickers this season. Did output per picker rise or fall, and by how much in kilograms?
Answer
Last season: 8 000 ÷ 16 = 500 kg per picker.
This season: 9 000 ÷ 15 = 600 kg per picker.
Output per picker rose by 100 kg, which is a 20% increase (100 ÷ 500 × 100). Output rose by 1 000 kg while the number of pickers fell by one, so output per picker clearly rose here. In the factory example the same step shows a fall, which is why you must divide before deciding.
What to study next
Continue with writing an economic explanation rather than repeating a calculation. Then try the integrated practice.
If you want a teacher to test your explanations on new tables, see online one-to-one Economics tuition.