Synthesis – The widening transatlantic divide of labour productivity

Publication date: 17 December 2025
Author: Olivier Redoulès, Economist and Director of Studies at Rexecode
Publisher: European Employers’ Institute (EEI)

This synthesis brings together the findings of EEI’s three-part research series on the EU–US labour productivity gap, covering the period 1995–2024. It confirms that the divergence in labour productivity between the European Union and the United States is structural, broad-based across sectors, and accelerating, with a particularly sharp widening since 2019.

The report highlights the central role of weaker productivity growth in the EU’s largest economies, persistent underinvestment in ICT and intangible capital, and a growing gap at the digital frontier, especially in information and communication services. While internal convergence within the EU continues, it has been insufficient to offset the overall transatlantic divergence.

The synthesis concludes that reversing the productivity gap will require a shift towards higher-productivity growth, supported by large-scale investment, deeper market integration and a more innovation-friendly regulatory environment