US productivity grinds to a halt

[BurtWorm]

http://news.bbc.co.uk/2/hi/business/6110470.stm

US economy appears to be hitting the brakes


US labour productivity slowed to a standstill in the three months to the end of September, the latest indication that the American economy is slowing.

With analysts expecting productivity to grow 1.1% in the third quarter, the zero figure from the Labor Department came as a surprise.

Unit labour costs were up 5.3% from the same period in 2005, the worst annual rise in 24 years.

The figures will increase inflation fears at the US Federal Reserve.

"Both the productivity and labour costs were pretty weak numbers and it adds to growing concern that economically speaking things aren't looking all that wonderful," said Collins Stewart analyst Michael Panzner.

"The combination could lead at least some investors to start talking stagflation."

...

[sutz12]

1. You have to have a job before you can improve it.

:banghead:

[Hugin]

2. Stagflation would make sense...

It's what happened last time energy prices were up for an extended time.

[no_hypocrisy]

3. Economically one can't equate consuming with producing. n/t

[ProfessorGAC]

4. We Can And Do All The Time

Equating the two of them is a sure sign of economic health. It's when they are out of balance that we have economic conditions as those currently existing. Remember, GDP is f(mv = pq)! And GDP = C + GS + TP + NE. So, in a healthy economy, you can, do, and should equate consumpion with productivity. Of course, right now, you're correct, because the correlation is very weak today.
The Professor

[no_hypocrisy]

6. Thanks. You make a good point. n/t

[Rosemary2205]

5. Someone got a raise?? Who??

If we start moving the wealth around away from the top 1% then "productivity" is going to fall because labor cost will go up -- and it should.

[nashville_brook]

7. question: shouldn't there (naturally) be a productivity ceiling?

someone help me here... what exactly are we talking about with this *productivity* number?

in the late 90s, during the Clinton/Gore Boom, productivity skyrocketed and was explained as having to do with better equipment and technical resources in addition to "innovations" in employee management.

it was the era of Fast Company and everyone was ready to take charge of their own destiny by working 70-hour weeks because the pay-off seemed real and right in front of us.

i remember when it stopped feeling like that... when it stopped being a liberatory exercise and it started to look more like ME DOING THE WORK OF THE WHOLE FORMER DEPARTMENT. that was, until the merger and the department was eliminated entirely.

so, what the hell is this *productivity* number anyway? because i don't think it means the same thing to workers as it does to owners.

[blues90]

13. I am certainly with you on this .

I have been around long enough , 57 years and as a workee I know damn well the economy is in big trouble , numbers do not include many , many people like me and others who can't even find a job to pay for basic breathing let alone any thought of extra items .

I have been made obsolete in this new 21st century and I am amoung many others who worked hard to end up here , screwed . Numbers on a paycheck count to me and that's all I look at .

[nashville_brook]

18. i'm a 10+ years experienced "creative" worker

read: nearly impossible to find a job in most cities. right now i'm in Orlando (gack) which is a wee bit better than Nashville for Art Direction, etc. still on the hunt after MONTHS, tho.

i need to get my ass to Chicago, Minneapolis or New York if i want to a REAL, lasting job. Meebee Miami.

[magellan]

8. Question about zero growth in productivity

Can we assume the reality is worse? Negative growth? (What's that called, retraction?)

[Hubert Flottz]

9. "productivity grinds to a halt"

Jump on the guys in China and India who took all the production jobs.

[sutz12]

10. Jump on the "American" CEOs that sold those jobs overseas. nt

[newportdadde]

11. This is one quarter boohoo, production way up and wages flat the past few YEARS.

Of course now that pay is FINALLY starting to rise we have an inflation problem. Don't tell me that inflation is just now a problem inflation has been a problem for the past several years as the Fed pumped out enough greenbacks to float the whole country and loaned it all away at decades low interest rate so we could sell each other overpriced houses.

Take a look at your own energy costs or your food costs. Hell look at healtcare costs, between 2004 and 2006.. two years, my healthcare premiums DOUBLED. This year they are 'only' going up 20%.

Inflation is here and now and its not because of wages.

[applegrove]

12. Sounds like time for a one time dump of Assets into the stock-market again.

:sarcasm: Will it be social security reform or death taxes?:sarcasm:

[sarcasmo]

14. What are you the true unemployment numbers. Michigan 7.1 percent on the books.

More like 15-25 percent would equal reality.

[alfredo]

15. this needs to get out there.

[bluedogyellowdog]

16. This article has the Most. Misleading. Headline. Ever.

I saw the same thing on Yahoo. I'm not blaming you by the way - just the people who wrote these articles. :)

U.S. productivity has NOT ground to a halt. The only way productivity would grind to a halt is if the entire U.S. workforce walked off the job en masse - a general strike.

What has come to a halt is "growth" in productivity. And zero growth in productivity, far from being the bad thing the article implies, is a good thing. Growth in productivity means employers squeezing more labor out of the working class for lower wages. It means wages going down, working hours going up, union jobs disappearing, unions being busted, Wal-Mart driving locally owned stores out of business, jobs being sent offshore, and American workers in good wage jobs being replaced by cheap labor from workers willing to do more work for less pay. We don't want productivity to grow because more productivity always means working families getting the shaft.

Both this article and the one i saw on Yahoo also promote the neocon talking point that paying employees higher wages causes inflation. Ridiculous. The level of wages has *nothing* to do with inflation, which is caused by the government printing presses increasing the amount of money in the money supply faster than the rate of population growth.

I'm not flaming you - just the people who wrote these misleading articles, and making that point that we need to stop buying into neocon assumptions (higher productivity good, deregulation good, higher wages cause inflation, etc.) and start looking at economics from a labor-centric, working class-centric point of view.

If growth in productivity is at zero, this is cause for celebration.
:party: :bounce: :hippie: :bounce: :party:

[BurtWorm]

17. That's a good point.

Thanks. :toast: