However, labor productivity in the nonmanufacturing sector as a whole continues to show higher growth than in the past, and has been exceeding the level seen before the Lehman shock. Developments in labor productivity include the effects of cyclical economic recovery, but the underlying trend reflects a pick-up in economic growth potential from a somewhat long-term perspective.
For example, reports on interviews with firms and other relevant information across regions suggest steady progress in firms’ efforts to create demand, such as for high value-added services, and to make active fixed investment, with both being done across a wide range of areas such as wholesaling and retailing, construction and real estate, accommodations, and eating and drinking services.3 Recent developments in the underlying trend of labor productivity in the nonmanufacturing sector show a strong correlation with developments in private consumption (Chart 9).