Labor Productivity of Services Sector in Malaysia: Analysis Using Input-output Approach

Productivity reflects the ability of an organization or country to generate higher income or value-added. As Malaysia is taking a rigorous step to become an advanced country with high-income status by 2020, it is crucial to have high productivity in the production processes. Due to the high share of the transportation, communication and financial sub- sectors to the overall economy, they are considered as the stimulants to the overall growth. This paper attempts to determine the labor productivity of these three sub-sectors using the input-output analysis approach. The methodological setting is the utilization of the “labor coefficients” calculated from input-output tables of Malaysia for the years 2000 and 2005 as well as through surveys of related sub-sectors in 2012.