Via The Chosun Ilbo
Korea’s productivity grew more slowly in the 2000s. The Knowledge Economy Ministry and the Korea Productivity Center on Thursday said analysis of the productivity increase rates of major countries between 1981 and 2005 shows that Korea’s total factor productivity increased by 0.12 percent between 2001 and 2005. That is a mere third of 0.39 percent in 1981-2000.
Total factor productivity is an index that accounts for effects in total per unit output as a result of all factors being used, such as capital, labor, energy, raw materials and services.
In the same period, the U.S. saw its productivity increase from 0.26 percent to 0.95 percent, while Japan saw almost no change from 0.27 percent to 0.25 percent. That means the Korean economy has grown not so much through increased productivity but chiefly through increased input of production factors such as capital, labor and energy.
A KPC official said, “We have to change growth structure by improving the quality of labor force, using capital efficiently, and enhancing quality of raw materials.”