Minister for Employment, Productivity and Workplace Relations Agni Deo Singh. [Photo: FILE]

Productivity growth in Fiji remains uneven as agriculture and manufacturing continue to underperform.

Parliament has been told that overall productivity has increased over the past eight years, driven mainly by the services sector.

Responding to a question from Opposition Premila Kumar, the Minister for Employment, Productivity and Workplace Relations Agni Deo Singh said productivity growth averaged about 2.5 to 3.0 per cent between 2016 and 2019.

He said this growth was disrupted in 2020 due to COVID-19, which hit economic activity, especially tourism.

He said productivity stabilised in 2021. It then rebounded strongly in 2022 and 2023. This was driven by the reopening of borders and recovery in services.

Singh said Fiji’s labour productivity now stands at about $19 per hour worked in constant international terms. He said this places Fiji in a mid-tier regional position. However, it remains at only about 18 to 20 per cent of the United States levels.

He said the data shows growth has been driven more by labour input. It is less driven by efficiency gains, technology or investment.

On sector performance, the Minister said services remain the strongest contributor. This is led by tourism, transport, and retail. He said these sectors recovered quickly after borders reopened and continue to drive productivity gains.

Manufacturing, he said, has remained largely flat over the eight-year period. This is due to high costs, small-scale production and slow technology adoption.

Agriculture continues to record the lowest productivity levels. He said many workers remain in subsistence farming and low-output activity.

He said agriculture, forestry, and fishing remain below 20 per cent of the national average. Productivity in the sector also fell during the pandemic as labour moved into lower-output rural work.

The Minister said the overall pattern reflects a structural imbalance in the economy. Services are growing faster than agriculture and manufacturing.

He also pointed to key constraints. These include low investment in capital, slow skills development, and climate risks.

He said rising temperatures could reduce labour productivity by between 2.8 and 8.3 per cent for every one degree Celsius increase. This is especially true in agriculture and construction.

The Minister said future growth would depend on investment in skills, technology, and efficiency. He said reliance on labour expansion alone was not sustainable.