Workers' 'Extraordinary' Productivity Gains Blamed For Jobless Recovery

washingtonpost.com:

Businesses are producing only 3 percent fewer goods and services than they were at the end of 2007, yet Americans are working nearly 10 percent fewer hours because of a mix of layoffs and cutbacks in the workweek.

That means high-level gains in productivity -- which in the long run is the key to a higher standard of living but in the short run contributes to sky-high unemployment.

Read the whole story: washingtonpost.com

Comments

[GCurry]

12:22 PM on 04/02/2010

This is a stupid argument.

When calculating "worker productivity" what does one count? What is a worker? Let N1=#American workers? Let N2=#Outsourced workers? Let N3=#Robot workers (include industrial automation, IT automation, robotic automation, by some measure). Let P= Productivity.

Most of these calculations show P increasing, and N1 staying mostly constant. Maybe they make some mention of N2, outsourcing. But they never mention how Robot workers are displacing Human workers.

So they calculate P/N1, or maybe P/(N1+N2) if they're feeling especially honest. But never P/(N1+N2+N3). Productivity is going up because human workers are being displaced by robot workers. That's all.

Implications left as exercise for the reader.

[Harrier]

11:28 AM on 04/02/2010

I have been working way too much OT and fighting back get normal hours, that a lone will add one or two more people.

[mountainweb]

08:28 AM on 04/02/2010

This is one of those arguments that sounds really silly but is totally stupid, leaves out the biggest factor, OUTSOURCING. Many companies have by design, moved 20-30% or more of their work force to India and other countries. Total stupidity to then count that as higher productivity by Americans and clam its THEIR fault. The socialist policy of the current administration has made worse the criminal activities of Wall Street and grossly incompetent management of companies like GM. And the brain dead outsourcing that has been and is being done by companies that are living on 3 month cycles, not based on long term growth but SHORT TERM profit margin.

[SwingingFromCenter]

06:25 PM on 04/01/2010

This is one of those arguments that sounds really silly - until you think about it.

Companies have pared down their workforces significantly. Workers are stretched so thin now, it's amazing they even have time to remember to breathe. Yet productivity isn't going down.

Now for companies, this is great news. They know they can get the same production for less employee overhead. The problem is, this puts way too much work on the shoulders of each employee, and makes a worker's professional life a constant source of stress.

The ironic thing is, it'll stay this way because the workers have convinced themselves that if they stand up to management over putting the work of 6 people on each one of them, they'll be replaced with someone else and be on the outside looking in.

Corporations have officially bea.ten the American worker down.

[sposton]

11:33 AM on 04/01/2010

"That means high-level gains in productivity -- which in the long run is the key to a higher standard of living...."

This pure nonsense! This was indeed true for the first 200 years of our Republic but it hasn't been true since 1970's. But what can one expect from kleptocratic propaganda outfit like Washington Post?

The stagnating wages since 1970's despite enormous "productivity improvements" is one of the greatest structural economic problem this country has faced and we can't even talk about this. Instead, we get clichés like this story.

[Papa Swamp]

09:30 AM on 04/01/2010

Technological advancement also makes fewer workers necessary. How many people did the computer replace? The robotic assembly line? Advancement is great but we fail to recognize that the population is increasing yet fewer workers are needed to do the same jobs a decade ago. Humanity is setting itself up for a very difficult time.

No I'm not saying technology is bad....it's our population growth that is the problem.

[SwingingFromCenter]

06:27 PM on 04/01/2010

It's kind of ironic. In my field (IT), we've made it an artform to invent ourselves out of jobs. One of the many reasons I'm glad I went into consulting rather than signing on as a full time network security engineer somewhere. The more advances we make with regards to networking, cloud computing, etc. the fewer IT professionals are needed to perform the same tasks.

[TJCole]

01:13 AM on 04/01/2010

Fear and Insecurity is a great motivator but only for so long, but when create a situation of excess labor as they have, there's always another to replace you..we're all disposable...

[laaambchop]

07:58 AM on 04/01/2010

It's been this way for at least ten years.

[TJCole]

11:45 AM on 04/01/2010

I'd say since that crack dealer Ronald Reagan...!

[weheartor]

10:40 PM on 03/31/2010

I wonder What's going to happen when these people get burned out...

[laaambchop]

08:00 AM on 04/01/2010

They look for another job. That's one of the reasons applicant tracking systems get so many resumes.

[noaxe397]

10:17 PM on 03/31/2010

Once again, blame the victim. What capitalists forget is that they do not create the jobs; the worker creates the jobwith his wages by creating demand for the goods the capitalist produces.
By getting rid of employees, capitalists supress demand for their products, which lowers their profits.

Remember, a business is just a conduit to connect a worker to a consumer, and sometimes they are the same person.

Henry Ford knew this over a hundred years ago when he paid his workers $5 a day for the sole purpose of ensuring they had sufficient income to buy the cars they built.

Consider a few stats:

Between 1947-1973 worker productivity increased 103%. Wages increased 103%
For every one-tenth of an hour (that's six minutes) the work week increases, it reduces the need for 300,000 workers..
The industrial corporations listed on the S&P500 stock index (just the industrials) are currently hoarding 842 BILLION dollars in case and short term securities.

Eight hundred and forty two BILLION.

Workers need to start demonizing corporations as un-American for not hiring workers when they are sitting on that much cash and working the snot out of those who are still there.

[gmb007]

12:46 AM on 04/02/2010

EXACTLY!

Economics really IS this simple.

It is WORKERS who drive the economy, who PRODUCE - not capital, not CEOs, not Wall Street.

Workers are the friggin glue that holds everything together.

You cannot divorce workers from consumers, compartmentalize one from the other.

Workers = Consumers

This is why the global race to the bottom with wages is so dangerous - there will ALWAYS be someone, somewhere desperate enough to work for even less...soon no one will be able to afford the products they produce.

Big Business is cutting its own throat. And ours, too.

Workers should be the best, long-term investment business makes! Why? Cause they're the customers who are gonna buy your products! Hello?

Yet what does Corporate America do? They SCREW and CHEAT workers at every turn for short-term profit. They lay them off, outsource jobs, close down and move entire plants overseas, slash wages/hours/benefits and then wonder why demand takes a nosedive and sales suck. Duh? Can they really be that stupid?

WORKERS=Jobs=Production=Wages=Customers=Sales=Demand=MORE WORKERS=......

Well-paid workers are the KEY to the whole damn mess!

[LeeCalif]

08:21 PM on 03/31/2010

" That means high-level gains in productivity -- which in the long run is the key to a higher standard of living ....."

Not in America. We all just drank the post World War II kool-aid.

Wake Up. But, the corporations have gained control. Too late. Going to take revolutions.

[GetAbike]

07:54 PM on 03/31/2010

The new normal.
I hope you are not over 55. I hope you are not looking for a job.
Have you ever wanted to be self employed? If you are over 55 AND unemployed, you better get busy because the shake out is over and those "admin" jobs are gone.

[sonoffestus]

12:07 PM on 04/01/2010

I have posted almost the same comment for a while now. You are exactly right. If you are in your fifties and unemployed, you have reached your retirement. What company wants to hire an older employee? You require a higher salary and your health insurance costs way more than a younger person. Fifty-five is the new 65. How's that shuffle board game going?

[FreedomCorpse]

07:00 PM on 03/31/2010

The people who caused the economic situation always blame someone else for the cause.

[Winston120]

06:26 PM on 03/31/2010

This is no more than working extra hours w/o pay.

Is the lib MSM this stupid? Yes.

[laaambchop]

08:01 AM on 04/01/2010

Why would the media be liberal? It is owned by corporations.

[PoliticalRockChick]

06:13 PM on 03/31/2010

Overloading employees with job = slave labor. Welcome to America.

[xrepublican]

05:55 PM on 03/31/2010

If you want to stay employed, you work 60-80 hours a week WITHOUT ever taking your vacation or sick time...... Welcome to the new indentured servitude.

The number of people doing TWO jobs or more is staggering. Companies SHOULD be hiring people to do the work needed - instead they are cutting staff and OVERLOADING the remaining employees.

Those doing the work do not share in the 'productivity increase' - their salaries do not go up. But top execs are grossly overpaid for the 'savings' they are showing.

A relative in a bank is working from 8-9 EVERY DAY since her department was cut back - though the total workload has INCREASED. Coming up with an idea that saved her employer $200,000 a year, she got a $500 'appreciation award'.

Ironically, those once worried that they lacked grad degrees are now safer because they are 'cheaper'...... the higher paid staff get laid off first.... people with decadesof experience are replaced with a newcomer making half as much......

[drumsgirl]

09:18 PM on 03/31/2010

Oh geez - growup - the sky is not falling. Employees have always had to work harder and put more in with less staff during tough times - I've been working over 30 years and this is not the first time. I work 40 hrs a week, I get 7+ weeks of leave a year, and I take it. And I got a raise and bonus this past year - tho both were delayed and smaller than usual.

[weheartor]

10:38 PM on 03/31/2010

WOW!!! 7+ weeks of leave.... Sounds like administration to me... is that why you have no heart for the us little worker bees???

[laaambchop]

08:05 AM on 04/01/2010

I don't know anyone on salary who works 40 hours a week. Fifty plus is the norm. And you are told this at the interview.