Not like I intended this to be a series or anything, but if you start looking at this you can find snowjobs creating six foot drifts.
Productivity Grew at Fastest Rate Since 1983
By THE ASSOCIATED PRESS
WASHINGTON (AP) -- Productivity of U.S. companies rocketed at a 9.4 percent annual rate in the third quarter, the best showing in 20 years, offering an encouraging sign that the economic resurgence will be lasting.
The increase in productivity -- the amount an employee produces per hour of work -- reported by the Labor Department on Wednesday was even stronger than the 8.1 percent pace initially estimated for the July-to-September quarter a month ago and was up from a 7 percent growth rate posted in the second quarter of this year.
The question you have to ask yourself is, "Is this a Good ThingTM?"
The increase in productivity -- the amount an employee produces per hour of work -- reported by the Labor Department on Wednesday was even stronger than the 8.1 percent pace initially estimated for the July-to-September quarter a month ago and was up from a 7 percent growth rate posted in the second quarter of this year.
The third quarter was prior to the WONderful employment stats of the past few months. Basically, this says people were worked even harder than we thought. Proof?
Businesses in the third quarter pumped out more and actually increased workers' hours, compared with a long string of quarters where hours were either cut or were flat.
More hours…but not more workers. Remember, we're talking third quarter here.
For the economy's long-term health and for rising living standards, productivity gains are vital. They allow the economy to grow faster without triggering inflation. Companies can pay workers more without raising prices, which would eat up those wage gains. And, productivity can bolster a company's profitability.
CAN pay workers more…but when was the last labor negotiation you heard of that didn't call for givebacks? Isn't that a significant method of achieving reportable productivity gains?
Of course,
On Wall Street, the good news on productivity lifted stocks. The Dow Jones industrials were up 31 points and the Nasdaq index gained 6 points in morning trading.
I ask again: How well does The Economy track with the quality of life around these parts?
A question I have regarding those productivity numbers before I make a judgment is how many of them reflect salaried worker hours vs. hourly worker hours.If they are salaried worker-hours, then clearly people are being worked harder to benefit the bottom line.If we're dealing with hourly worker-hours, however, I can see many of those workers being quite happy with an increase that leads to a direct increase in salary, particularly if it pushes them into overtime. Especially since many manufacturing workers simply get put on unpaid leave when manufacturing slows down, and get paid nothing.It seems with the spiraling costs of healthcare, productivity will get more and more important, due to the high fixed costs of adding additional full-time workers. Perhaps national healthcare is a better solution than it first appears.