Direction de la Science, de la technologie et de l'innovation
Is there a trade-off between productivity and employment?
A cross-country micro-to-macro study
The impact of productivity on employment remains uncertain, particularly in light
of growing concerns regarding potential negative effects of technological progress
on labour demand. This report uses harmonised and comparable data from 13 countries
spanning the last two decades to comprehensively analyse how productivity growth affects
employment dynamics at various levels of aggregation. The study's findings highlight
a positive correlation between productivity growth and employment as well as wage
growth, both at the firm level and on a broader scale. This outcome arises from counteracting
mechanisms and heterogeneous dynamics across different groups of firms. The findings
have relevant policy implications: productivity is not just an isolated key economic
objective, but well-designed and complementary policies can also help convert technological
and organisational change into higher employment and wage growth.
Available from August 09, 2023
In series:OECD Science, Technology and Industry Policy Papersview more titles