Hourly labour productivity in the market economy has increased twice as fast in the United States (3% per year) as in the EU-15 (1.5%) over the 1995-04 period. Over the 1980-95 years, productivity gains, on average, have gone up more in the EU than in the United States: 2.4% against 1.5%.

The EU KLEMS database from which these data are derived allows the sources of productivity gains to be traced to changes intervening in:
- the labour composition (as L in the graph below),
- the capital deepening (K) broken down in ICT assets (Kit) and non ICT assets (Kn),
- the total factor productivity (TFP).

Over the 1995-2004 years, on account of an unequal contribution of TFP gains between the US (1.6 points of % per year) and the EU-15 (only 0.3 point), the gap between both zones has widened.
In the EU, TFP gains are rather higher in the UK and France. In Italy and Spain, the decline in TFP has cancelled a large share of the gains resulting from the improvements in labour quality and capital deepening.
By sector, the most protruding difference shows up in the trade sector: the contribution of TFP has amounted to 3.2 points in the United States and to only 0.4 point in the EU-15.

The EU KLEMS project, is funded by the Research-DG as part of the sixth Framework Programme, Priority 8. For each EU member country, national data have been processed in 72 industries, along the same template, by a national team. For France, this work has been carried out by the CEPII. “Sister datasets” have been constructed for the United States and Japan.