1. Output
During the period 1998 to 2008, the Gross Domestic Product (GDP) in real terms grew by an annual average of 4.6%. During the same period, the real output of the Manufacturing sector grew at a lower rate of 1.6% per annum while that of Export Oriented Enterprises (EOE) declined at an annual rate of 0.1%.

2. Labour input (employment) and labour productivity
From 1998 to 2008, labour input for the whole economy grew by an average of 1.3% annually, while that for the manufacturing sector and EOE declined by 1.7% and 2.8% respectively. Labour productivity, as measured by real output per person engaged, grew by 3.3% for the economy as a whole. The same rate of 3.3% was registered in Manufacturing, while in EOE a slightly lower growth of 2.8% was registered.

In 2008, labour productivity for the economy grew by 1.6% lower than the 3.7% registered in 2007. This lower rate was mainly due to a higher growth in labour input of 3.7% in 2008 compared to 1.6% in 2007, while GDP growth in 2008 was 5.3% almost same as in 2007. Labour productivity for Manufacturing increased by 2.4%, higher than the growth of 0.8% in 2007 while EOE witnessed a lower increase of 2.5% in 2008 compared to 6.2% in 2007.

3. Capital input and capital productivity.
During the period 1998 to 2008, capital input grew at an average annual rate of 5.4% for the total economy, 4.0% in Manufacturing and 4.6% in EOE. However, because of low growth in output compared to capital input, capital productivity defined as the ratio of output to capital input, declined by 0.8% for the economy, 2.3% for Manufacturing and 4.5% for EOE.

After a decline of 0.4% in 2007, capital productivity for the total economy declined further by 0.5% in 2008. In Manufacturing, capital productivity in 2008 witnessed a small increase of 0.3% after a decline of 5.7% in 2007 while in EOE, a high increase of 5.0% was noted in 2008 after a decrease of 7.4% in 2007.

4. Average compensation of employees and Unit Labour Cost (ULC)
From 1998 to 2008, average compensation of employees increased by an average of 8.2% annually for the whole economy, 9.2% for Manufacturing and 8.5% for EOE. ULC defined as the remuneration of labour (compensation of employees) per unit of output, grew at an average annual rate of 4.8% for the total economy, 5.7% for Manufacturing and 5.6% for EOE, as a result of higher growths in average compensation of employees compared to labour productivity.

During the same period, unit labour cost in Dollar terms, increased at an average annual rate of 3.1% for the total economy, 4.0% for Manufacturing and 3.8% in the EOE.

In 2008, ULC for the economy increased by 8.7% compared to 6.7% in 2007. In Manufacturing, an increase of 10.1% was noted in 2008 compared to 11.2% in 2007 while in EOE, a lower increase of 3.4% was registered in 2008 compared to 5.4% in 2007. In Dollar terms, ULC in 2008 increased by 20.2% for the whole economy, 21.8% for Manufacturing and 14.4% for the EOE as a result of a high appreciation of the rupee.

May 2009