The crucial importance of labour quality for Europe’s economic performance is also corroborated by recent research at the ECB (Schwerdt and Turunen, 2007) which suggests that improvements in labour quality have made a substantial positive contribution to labour productivity growth in the euro area.
Due mainly to a notable increase in college education, the average annual growth rate of labour quality in the euro area is estimated at about 0.5% in the twenty-year period 1984-2005. The relative contribution of the improvement in labour quality has also increased over time, accounting for up to one fourth of euro area labour productivity growth since 2000.