Trends in agricultural labour productivity in the EU

Abstract

Labour productivity represents production efficiency and is the key factor in income and consequently the standard of living. Incomes are lower in rural areas than in urban areas in any country. Labour productivity in the agricultural industry varies significantly, i.e. tenfold, across EU Member States, with the lowest labour productivity being reported mostly in East European Member States, which makes it necessary to achieve higher productivity in these Member States. The present research aims to examine trends in agricultural labour productivity in EU Member States. The research found that the fastest increase in agricultural labour productivity occurred in East European Member States, while a mixed situation was observed in West European Member States, i.e. in some Member States the productivity increased at a lower rate or even decreased. An analysis of correlation between agricultural labour productivity and the number and average size of agricultural holdings revealed that the situation was mixed across the Member States, with some of them showing a positive trend, whereas some had a negative trend. The Member States with the lowest agricultural labour productivity need to foster increases in it through encouraging their farmers to own/manage larger areas and take advantage of economies of scale.