Maybe Weve Been Thinking About the Productivity Slump All Wrong.
'American businesses are doing a terrible job at making their workers more productive.
Productivity growth is the weakest it has been since the early 1980s — only 0.8 percent a year over the last half a decade, compared with 2.3 percent on average from 1947 to 2007. This is the root cause of slow growth in both G.D.P. and worker pay.
At least, that is the standard way of thinking about productivity and its relationship to the economy. In a mainstream view, productivity is a kind of magic force that helps explain rising output. New labor-saving inventions come along or new management practices are taken up that miraculously allow companies to produce more output with fewer hours of work.
You can’t really predict when and how those innovations will arrive, in this view. Henry Ford starts using a moving assembly line. Sam Walton perfects the just-in-time supply chain. Easy-to-use word processors result in fewer businesspeople who need secretaries. Voilà, the productive capacity of the nation rises, along with incomes and living standards.
But what if this is the wrong way of thinking about it? What if productivity growth is not so much an external force that proceeds in random fits and starts, but is rather deeply intertwined with the overall state of the economy and labor market?
It’s a chicken or egg problem: Does low productivity cause slow growth, or does slow growth cause low productivity?'>>>
https://www.nytimes.com/2017/07/25/upshot/maybe-weve-been-thinking-about-the-productivity-slump-all-wrong.html?
