The Productivity Puzzle and Northern Ireland

Since late 2010, the UK economy has experienced a period of stagnating output coupled with improvements in the levels of employment. This counterintuitive situation has been dubbed the "productivity puzzle" and economists have struggled to explain it. It seems no one factor can explain this paradox in full, and the evidence for some explanations is mixed. This In-Brief seeks to evaluate the explanations that have been put forward so far, and to examine what extent these features can be identified in the Northern Ireland economy. Equally important however is the extent to which the factors that explain this current conundrum are temporary or more persistent as this will have significant implications for current policy making.

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