What is happening with labour productivity in the euro zone?
Labour productivity has been declining markedly in the recent period in Germany, Italy, Spain, and somewhat less in France, which has resulted in a marked deterioration in cost competitiveness and profitability in these four countries. What could explain this decline in productivity? An unexpected decline in growth; this may be the case in Germany and Italy; The hiring of low-skilled employees with a low level of productivity; this is the case in France and Spain; A fall in labour costs; this is not the case anywhere. The low productivity in France and Spain is therefore definitely explained by low-skilled job creation .