EMPLOYMENT IN THE MARKET ECONOMY IN ... - Eurostat - Europa

Chapter 1— Employment and value-added
Labour productivity and investment
Capital employed in market services can be estimated
in the same way as for industry, namely, by relating investment
to hours worked to give a measure of capital
used per unit of labour input. Investment per hour
worked can then be related to value-added per hour
worked to measure the importance of capital in generating
value-added. Results confirm a clear relationship
between the two variables over the enlarged EU
as a whole, with sectors with the highest level of productivity
being also those with the highest levels of
capital per hour worked (Graph 12).
Value-added and investment per hour worked
in market services
12 Correlation between value-added per hour and
investment per hour in market services in the EU,
2001
Value-added per hour worked (EUR)
70
60
50
40
30
20
10
0
Computer & related
activities (72)
Water transport (61)
Research+development (73)
Hotels, restaurants (55)
Real estate activities (70)
Rental activities (71)
y = 0.7x + 23.3
R 2 = 0.73
0
0 10 20 30 40 50 60 70
Investment per hour worked (EUR)
EU covers all old and new Member States except EL, LU, PL and SI
Source: Eurostat, SBS, LCS and LFS
70
60
50
40
30
20
10
As noted in respect of industry, there is likely to be a positive
relationship between value-added and investment in
market services, especially insofar as investment reflects
the capital used in service activities. Value-added,
therefore, will tend to be higher for any given level of labour
input, the larger the amount of capital employed
and, accordingly, the higher the cost of that capital (in
terms of rent and servicing borrowing) and the required
return on investment. The amount of capital employed in
service activities is particularly large in real estate (NACE
70) and leasing (NACE 71), which, accordingly, tends to
imply relatively high value-added per hour worked. It is
also large in parts of the transport industry and communications,
in which, accordingly, value-added per hour
worked is high as well (Graph 12).
The relationship between investment and value-added,
however, is also affected by the skill level of the workers
employed and their productivity per se, which will tend to
be reflected in their average earnings. In computers and
related activities, therefore, value-added per hour
worked is higher than would be expected given the level
of investment (ie the sector lies above the regression line
describing the average relationship in the graph). On the
other hand, in Hotels and restaurants, value-added per
hour worked is lower than would be expected given investment
because of the relatively low skill, and wage,
level of those employed in the sector.
33