OECD Compendium of Productivity Indicators 2026

Executive Summary

Labour productivity grew in most OECD countries in 2024 despite elevated uncertainty

Across all OECD countries, labour productivity at the total economy level grew by 1.2% in 2024, double the growth recorded in 2023. Despite geopolitical tensions, skill shortages, and elevated economic uncertainty, 29 OECD countries saw labour productivity gains in 2024, suggesting that a productivity‑enhancing role of artificial intelligence (AI) may have offset some of the negative headwinds.

The OECD average investment rate, measured as economy-wide gross fixed capital formation as a share of GDP, declined modestly from 23.0% in 2023 to 22.6% in 2024, supported by robust spending on ICT assets, possibly reflecting firms’ efforts to deploy AI. ICT investment rates have risen broadly since the pandemic, but unevenly across OECD countries, leading to wider cross-country gaps.

Virtually all OECD countries were more productive in 2024 than two decades ago, but the pace of improvement has roughly halved since the early 2000s. If pre‑2007 trends had continued, labour productivity levels in 2024 would have been an estimated 10-20% higher in 2024.

In the United States, labour productivity rose by 2.2%, marking the second consecutive year of growth. By contrast, the European Union saw a modest increase of 0.2%, following a 0.9% decline in 2023. Consequently, the transatlantic productivity gap widened further, with labour productivity in the European Union reaching only around three-quarters of the US level when measured in constant 2020 Purchasing Power Parities. Similar patterns are observed across other OECD economies, with Japan and Korea slightly below two-thirds and Australia at just over four-fifths of the US level.

Poland, Bulgaria and Denmark emerged as the top performers across the OECD, with Denmark recording gains in manufacturing productivity driven by pharmaceuticals. Preliminary data and OECD nowcast estimates point to positive economy-wide labour productivity growth in 2025 across most OECD countries, with a marked acceleration in the European Union.

Multifactor productivity growth continued a downward trend seen since the 2000s

Growth in multifactor productivity (MFP) – capturing how efficiently labour and capital inputs are combined – remained weak or even declined at the total economy level in most OECD countries with data for 2024. Marking a continuation of a downward trend since the 2000s, average MFP growth across 21 countries with available data declined to around -0.3% in 2023-24, compared with roughly 0.8% in 2010-19 and 1.5% in 2000-07. Amid weak MFP growth, GDP growth in 2024 relied more on increased labour input than on efficiency gains compared with 2000-19.

Conventional MFP metrics disregard the environmental pressures caused by emissions of greenhouse gases and air pollutants, and the depletion of natural capital. Environmentally adjusted multifactor productivity (EAMFP) is designed to incorporate these environmental effects, and GDP can similarly be adjusted to provide a measure of output net of pollution. The efficiency gains captured by EAMFP are estimated to explain roughly half of pollution-adjusted GDP growth in 38 OECD countries over 1996-2018.

Aggregate productivity figures conceal differences across industries and firms

Over the period 2023-24, labour productivity continued to be driven primarily by productivity developments within industries, rather than by shifts in hours worked across industries. Manufacturing productivity weakened in several European economies, partly due to falling labour productivity in automotive production and energy-intensive industries and partly reflecting labour hoarding, as firms retained workers despite subdued production levels.

Industry-level differences in MFP growth across OECD countries have become more pronounced since 2000. This divergence is most visible in digital-intensive industries, possibly reflecting uneven cross-country diffusion of advanced technologies. Information and communication services and professional services – activities where AI adoption is particularly prevalent – experienced the strongest MFP growth across industries in 2024 on average across OECD countries with available data.

In 2024, across OECD and accession candidate countries, average labour productivity of small and medium-sized enterprises was only 65% of that of large firms. Since 2013, this gap has widened in most countries with available data. Yet, there is considerable variation among firms of similar sizes, with around 95% of productivity variance within a given industry occurring within size classes.