JOHN McDONNELL has criticised the “do-nothing” Tory government after new figures revealed that productivity levels fell for the third quarter in a row.

Hourly output fell by 0.2 per cent from January to March, compared with the same quarter a year ago, new data released by the Office for National Statistics (ONS) shows.

The number of hours worked grew faster than actual economic output, the ONS said.

This is the third consistent quarter where Britain has registered a real-terms decline in productivity.

Shadow chancellor Mr McDonnell said: “With business investment also falling and wages still lower than a decade ago, we have an economy in a state of neglect, damaged by years of Tory mismanagement.”

Meanwhile, Labour’s shadow employment minister Mike Amesbury said that “struggle” is the reality behind what the government and business leaders described as a “thriving” jobs market.

Stephen Clarke, of the Resolution Foundation think tank, said that unemployment falling to a 44-year low was “likely” because “people are working more hours to compensate for lower pay.”