The connection between a slow- down in productivity and growing inequality

Policy Brief

22/12/2016

Within the last couple of years, OECD has made several papers about low growth in productivity and rising inequality, respectively. However, in newly published OECD rapports (“The Productivity-Inclusiveness Nexus” and “Economic Outlook 2016”), the focus lies on the connection between growth in productivity and inequality. On one hand, low growth in productivity in some sectors and companies is a contributing factor to the increase in inequality because the workers in low-productivity companies fall behind both regarding productivity and salary. On the other hand, higher inequality means that less people can afford education and will therefore end up in low-productivity jobs.

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