Contrary to the microeconomic/market approach, my take is that productivity is very much a macroeconomic issue. In this regard, I side with post-Keynesian economists Nicholas Kaldor and Robert Eisner, both of whom argued that the level of employment and the degree of competition in labour markets have an incidence on productivity and overall growth. James Galbraith summarizes this point succinctly when he argues that
...full employment production foments ample competition in product markets, high rates of technical change, and declining costs, as business seek ways to save on scarce and expensive labor. In other words, productivity growth accelerates because of full employment itself. (emphasis added)
Now, it's important to recognize that employment growth irrespective of the type of employment probably won't do much to increase productivity. As highlighted in the OECD report cited above (and implied in the quote by Galbraith), the type of employment growth is a critical factor impacting on productivity.
For this reason, it is best if policymakers seek to prioritize employment growth in the manufacturing sector, the sector that is most amenable to improvements in productivity (see here for more on why manufacturing matters for productivity growth).Read it at Fictional Reserve Banking
Employment and productivity growth