West Post(Adds dropped word "to" in headline) Sept 25 (Reuters) - Britain's budget forecasters may have to raise their downbeat view of productivity growth in the light of a new way of measuring it, but the revision is likely to be too late to help finance minister John Healey with his tax and spending plan announcement next month, a think tank said on Friday. Britain's official statistics office said last week that the pace of growth in output per hour in the country between 2007 and 2019 was almost twice as fast as previously thought, based on a new methodology using more reliable data. The Resolution Foundation said the change took the UK productivity growth rate from the Group of Seven's second worst to its second best, behind only the U.S.
But Britain's level of productivity still lags well behind that of France and Germany. Here are other points from the Resolution Foundation's release: • The persistent productivity gap between Britain and France and Germany even after the revision suggests its productivity problems are deep-rooted and may precede the global financial crisis, the think tank said • the revisions suggested the government should do more to address a fall in hours worked - which was a key factor behind the higher productivity growth estimate - and to get more people into work, it said • other assessments of recent data have shown an improvement in British productivity growth over the last couple of years that Healey has hailed as a sign of an economic turnaround • "The OBR (Office for Budget Responsibility) may revisit its assumption in time, but sadly for the Chancellor this is unlikely to affect the forecast at this budget," said Simon Pittaway, principal economist at the Resolution Foundation • The OBR, whose forecasts underpin the budgets of British governments, last year lowered its view of future productivity growth. (Reporting by Andy BruceEditing by William Schomberg)
Source: Euronext Markets
