At the sectoral level, the recent, favourable labour productivity performance has been mainly driven by positive cyclical developments in industry excluding construction. In this sector, labour productivity growth has steadily increased since 2004, reaching 4.1% year on year in the first quarter of 2007. In contrast, annual labour productivity growth in services has not improved as much, even if it also rose slightly.
These encouraging signs must be weighted against the fact that data based on productivity per hours worked show a less spectacular improvement in 2006. Since only yearly data on hours are available for the euro area, we will need time to understand whether changes in working time distort the interpretation of quarterly data on productivity per employed person.