DEVELOPMENT

Table 4.4.4
Comparison of the productivity levels of the branches of Estonia’s manufacturing industry with other states in 2010. (%)
Branches of industry
Ireland
Food 11 20 23 23 30 34 41 65 89 101 106
Textiles 27 20 20 23 29 25 46 56 74 128 89
Clothing 38 15 12 24 25 23 45 62 100 113 123
Leather 14 17 15 17 22 17 34 59 91 94 74
Wood 49 34 37 43 48 37 74 118 156 216 153
Paper 62 43 50 46 29 38 58 116 128 136 97
Publishing 29 31 36 44 45 31 57 88 116 164 142
Chemical 34 26 23 18 29 26 35 67 83 77 134
Pharmaceutical 4 10 17 28 18 25 21 33 76 46 73
Rubber, plastic 36 20 19 25 29 27 39 55 62 79 82
Other non-metallic mineral products 42 26 35 37 44 35 52 82 88 105 109
Basic metal 33 23 29 24 24 21 34 60 92 76 55
Metalworking 41 25 30 31 39 30 47 75 102 124 120
Electronics, Equipment 10 16 20 16 23 22 30 65 101 82 48
Electrical equipment 42 25 28 32 29 25 40 67 103 112 126
Machine building 27 22 26 23 28 27 34 69 85 46 90
Motor vehicles 57 36 36 32 51 29 40 69 70 59 83
Other transport equipment 29 23 44 28 72 22 38 85 88 146
Furniture 17 18 29 32 32 45 79 93 130 89
Source: Eurostat
Denmark
Switzerland
Netherlands
Finland
Austria
EU 27
Slovenia
Czech
Republic
Hungary
Slovakia
4.4.5
Productivity of the branches of
Estonia’s service sector
Below, the productivity of the branches of Estonia’s
service sector are analysed in more detail. Productivity
is again measured as value added per worker, and the
branches of Estonia’s service sector have been compared
to some other small EU states and the average of the 27
EU states. In the interests of providing a better overview,
the productivity data has been modified so that for all the
states involved in the comparison, the level of Estonia’s
productivity was calculated as a percentage of the corresponding
state’s productivity in the given branch of the
service sector. Table 4.4.5 shows that the productivity of
the branches of Estonia’s service sector in several areas of
activity exceed the levels in the Czech Republic, Hungary
and Slovakia, and in regard to the labour leasing, also the
level in Netherlands. Of the service branches, Estonia’s
level of productivity has the best position in warehousing,
where productivity is 69% of the average EU level,
followed by 63% for the leasing and brokering of labour,
59% of leasing and operational leasing, and 47% for legal
activities and programming.
4.4.6
Unit labour costs
Below, based on OECD data, the dynamics of the unit
labour costs in the reference states have been explained
from 2000 to 2011. The base year for the analysis is 2005,
or the unit labour costs ratio for the given year equals
100, and the change is calculated in relation to this year.
In Table 4.4.6, the reference states are ranked on the basis
of the total change in the unit labour costs. Of the reference
states, the unit labour costs have increased the most
in Estonia. Although, the growth of Estonia’s productivity
had been very rapid, and exceeded the indicators of
most of the reference states (Figure 4.4.1), the unit labour
costs have increased at an ever faster pace. In Estonia,
the period from 2005 to 2008 is clearly differentiated,
during which the unit labour cost increased by nearly
50%, i.e. the gap between the growth of productivity and
the increase in labour costs was very wide. In the next
period, from 2008 to 2011, the ratio of unit labour costs
decreased somewhat. On the one hand, in connection
with the economic recession, the pressure to increase
wages disappeared, and on the other hand, the companies
reorganised their work processes and were able to
increase productivity.
From 2000 to 2011, the unit labour costs changed
the least in Ireland. Although, in the period from 2000 to
2004, a significant increase occurred in the value of the
ratio, starting in 2009, the unit labour costs decreased.
The reason for this is the unemployment and reduction in
wages that were caused by the financial crisis. Therefore,
productivity has increased somewhat between 2008 and
2001, but wages declined during the same period. The
increase in unit labour costs has been relatively small,
only 4.9%, in the South Korea, where the distinctive characteristic
is the relatively rapid increase in the unit labour
costs, which also exceeded the increase in productivity
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