Singapore labor productivity stuck in a decades-long rut

The country's worker efficiency gains have slid since the 1990s and are now one of slowest-growing in Asia.

A new HSBC study found that Singapore -- along with Taiwan -- has experienced two decades of plummeting labor productivity and has contributed to higher inflation pressures. Comparatively, Asian neighbors like the Philippines and India have posted impressive efficiency gains that leave Singapore in the dust.

Here's more from HSBC:

In most economies, gains in worker efficiency have slowed over the second half of the past decade. The exceptions here are China, India, the Philippines, Thailand and Vietnam. However, except for the Philippines and India, productivity growth is down here too markedly from the early 1990s.

Note that in Singapore and Taiwan, efficiency gains slowed sharply not only from the 1990s but also over the last decade. China continues to do remarkably well: even if labour productivity growth was recently lower than in the early 1990s, it is still high and even ticked up from earlier in the decade, lending support to HSBC chief China economist Qu Hongbin’s view that in the industrial sector especially, China continues to register healthy productivity gains.

Scaling gains in labour productivity to GDP growth, the picture for Asia is not quite as bleak. Most markets have seen the “contribution” of labour productivity to GDP growth hold steady or even rise, in recent years. Singapore and Taiwan, however, again registered a large drop, with worker efficiency gains also slowing in Indonesia relative to GDP growth.