This paper uses individual data on employment and wages to shed light on the UK's productivity puzzle. It finds that … workforce composition cannot explain the reduction in wages and hence productivity that we observe; instead, real wages have … lower capital-labour ratio. We cannot tell whether productivity is driving wages or vice versa, but understanding why wages …

workers are affected the most, how employment and wages adjust to increased services trade, and the impact of policy settings … quantitatively small. Looking at the distributional impact, there is mixed evidence for a skill bias in wages related to increased … exert downward pressure on the wages of women compared to the ones of men. …