Productivity slows to a standstill

[DoYouEverWonder]

Nov 2, 2006

WASHINGTON - The productivity of American workers slowed to a standstill in the summer, while wages were rising at the fastest clip in more than two decades — a combination likely to raise inflation concerns at the
Federal Reserve.

The Labor Department reported Thursday that productivity, the amount of output per hour of work, showed no change in the July-September quarter, while labor costs rose by 3.8 percent. For the past year, wages and other labor costs are up by 5.3 percent, the fastest increase since 1982.

While rising wages and benefits are good news for workers, they raise concerns about inflation especially at a time when productivity is slowing. If companies decide to pass on their higher payroll costs by boosting the price of their products, that could translate into increased inflation.

In other economic news, orders to factories for manufactured products rose by 2.1 percent in September, the biggest increase in six months, but virtually all of the strength came in a surge in orders for commercial aircraft. The
Commerce Department said that orders for long-lasting durable goods were up 8.3 percent, offsetting a 4.6 percent drop in demand for food, gasoline and other nondurable products.

http://news.yahoo.com/s/ap/20061102/ap_on_bi_go_ec_fi/economy

Wow, isn't that Bush economy great. :sarcasm:

[ixion]

1. rising wages

:rofl:

I haven't had a raise in three years.

[enki23]

2. dare i guess that the "rising wages" is based on an average wage?

.

[SoCalDem]

4. High paying jobs eliminated..and el-cheapo jobs in abundance

You can be sure they have carefully re-jiggered the figures to show rising wages..

And anyway, what good is a rising wage when the additional COSTS of living are farf eyond them?

Big deal.. Mr Jones gets a $1 hr raise.. IF he works a 40 hr week, he "might" see $30 extra in his paycheck, but he probably LOST overtime pay, so he's behind already...and if his share of the medical benefits (if he has any) went up even $10 a week, he's now down to $20..

Now factor in a tank of gas that cost him $20 last year, and is now $40..he's at the break-even Z E R O benefit to him..

and of course his groceries have gone up, and his electricity, water, home heating, food, medicines, co-pays..you name it.

That $4o a week raise only keeps him from falling further behind than he already is..

and yet he's still "expected" to max-out his 401-k, save extra for his old age, save for college for his kids, and save some more to help his elderly parents someday... and he's should also be saving to buy that house..

[Straight Shooter]

3. Rising wages? Fastest clip in more than two decades?

May we have some actual backup numbers for this fantastical assertion?

"The machine" is in overdrive.

[Warpy]

6. My guess is that CEO pay is heavily factored in

[Straight Shooter]

9. Right. Like the old joke about Bill Gates walks into a bar ...

... suddenly everybody in the bar is a multi-millionaire.

[brentspeak]

11. Your guess is probably right

[rmgarrette64]

12. Personal experience does back this up

May we have some actual backup numbers for this fantastical assertion?


My husband programs video games, and has gotten fairly large raises each of the last two years. After each game finishes, he looks around for other jobs, usually finds offers fairly quickly. Then his employer offers him a big enough raise to stay with them.

Now, this is a lone data point. I'm a teacher in a Catholic School, and have gotten acceptable but not great raises for the last few years. Still, combined we've been doing very well. There are professions that are in big demand, we're lucky enough to be in one of them.

R. Garrett

[acmejack]

13. Right on cue!

Knew some one was making all that money. YaY you!

[Straight Shooter]

14. Your personal experience is considered an anecdote, statistically speaking.

My personal experience, also an anecdote, is just the opposite.

Video games are hot now, and will probably be hot for a long time to come. So I congratulate you and your husband on your good fortune. Although I'm not sure that teaching in a Catholic school is necessarily good fortune. ;)

[prolesunited]

23. Excuse me

but ONE example does NOT prove a case and is no way statistically valid. Hope you're not the one in charge of teaching a course in logic.

[Lorien]

24. Personal experience shows the opposite

I'm an animator who works in the feature film industry. I know of over 800 layoffs that have occurred to my fellow animators in recent years. I also have a freelance illustration business. My main client, a major corporation, just off-shored ALL illustration and graphic design work (I've worked with them for nearly 18 years). I have been forced to drop my fees by 35% to remain competitive, and I can only find about 15 solid hours of work a week-which is better than many of my former colleagues, who are now fully unemployed.

[Megahurtz]

31. OFF-SHORED Illustration and and Graphic Design Work???????

Good God. :wow:

:nuke:

[GOPBasher]

15. You said that right.

Rising wages? Are they fucking serious? Do they keep a straight face when they write this shit?

[Union Thug]

5. Okay, so when does Zippy the Pinhead make a cameo...

I mean, this is bizzaro world...

[dkofos]

7. More Enron accounting

[fasttense]

8. The rise in productivity was all smoke and mirrors anyway.

They fired American workers and hired foreign labor, which they didn't have to report. So it looked like a rise in productivity when it was only a move of jobs to foreign shores. This current crop of CEOs and corporate executives couldn't pull-off a real productivity growth if American workers gave them and extra day a week for free.

[neoblues]

10. And if you think things are Great now....

Just try not to realize that many gigantic economic effects can follow in a kind of delayed-reaction. Especially the sort of economic changes that have been wrought by the Bushistas.

For decades we'll be seeing the economic landmines planted by shrub coming due; and, at that point, even if we radically rearranged our economic ideology and law to exact fairness--by taking back, through taxation, the profits that were made by those who actually planted the seeds of destruction, it wouldn't come close to making up for the damage that will have resulted. Of course, we'll probably not make them pay even then--and millions of Americans will pay yet again, on top of having suffered and paid in the years before.

Our unspoken Aristocracy and the vast disparity of wealth and opportunity must one day be addressed. How much suffering the majority of people must endure before we do will be defined by how long it is before they realize that it has to change and decide to make those changes. Alas, if Orwell and others are right, this victimization can continue indefinitely. So long as the right kind of education can be withheld from a large enough segment of the people, or those people are otherwise manipulated, addicted to entertainment or whatever... it doesn't look like they'll ever set themselves free.

The very existence of the "base" of the Republican Party is perfect evidence that large numbers of people can easily be manipulated--just limit education, and then co-opt the modern methods of communications such as the mass-media, create programming to "think for" the people, provide the occasional "scare" and it's done. Many people prefer the illusion of freedom to having to actually think for themselves; but this too, is a consequence of how they've been educated (rather, how they've not been educated).

Knowledge is freedom; unless you can convince people they don't want to know something. Adam and Eve is a fine example of teaching someone they don't want to know something. Look at all the trouble Eve brought us for merely wanting to know more... one moral of the story is: don't be curious, don't listen to "unauthorized" information, don't consider changing the status-quo... (or risk being thrown out of paradise).

What was that joke? About a little bird, a cow, a cat...
"The Moral of the Story:
*Not everyone who shits on you is your enemy.
*Not everyone who helps you is your friend.
*If you are warm and happy in a pile of shit, keep your mouth closed."

The little bird, saved from the cold by being buried in a cow-pile begins to sing, only to end up being "saved" and then eaten by a cat...

Multiple meanings, but one is that so long as you are comfortable, even in shit, you don't want to change the situation because it's keeping you comfy and facing the real world is a cold, harsh, potentially dangerous thing to do? Therefore we should just trust that this warm, cozy economy (which isn't that comfortable and rather stinks) and it's reliance on "capitalism" and "free markets" (and subsequently a wealthy upperclass) is in our best interests--that we might freeze to death or get eaten if we questioned it or tried to change it...

[Thor_MN]

16. What a dumbass article. INCREASE of productivity slowed.

If you state that "The productivity of American workers slowed to a standstill in the summer", then you are claiming that essentially NOTHING was being produced by the end of summer. If the title and first line of the article contained such stupid statements, can there be anything in it worth reading?

[frankenforpres]

21. by standstill

they mean productivity per hour was the same at the end of the summer as the beginning of the summer. not that productivity was zero

[Thor_MN]

25. Right, exactly what I said the first time.

That the change in productivity was at a standstill, not what they wrote, that productivity was at a standstill.

An analogy would be aceleration vs. velocity. If you increased the speed of your vehicle until you reached 60 mph at 1PM and kept it there until 2PM, would it be correct for me to say that your velocity had come to a standstill between 1 and 2? By analogy, that's what the article stated. Or I could wait for someone to chip in and say that what I meant by saying your velocity had come to a standstill was that your speed at 1PM was the same as 2PM. I still wouldn't be right...

[Hissyspit]

17. AP: Productivity Growth Skids To Standstill

http://www.nytimes.com/aponline/business/AP-Economy.html?_r=1&oref=slogin

Productivity Growth Skids to Standstill

By THE ASSOCIATED PRESS
Published: November 2, 2006
Filed at 9:31 p.m. ET

WASHINGTON (AP) -- Growth in productivity -- the key ingredient for rising living standards -- skidded to a standstill in the late summer while workers' wages and benefits shot up at the fastest clip in more than two decades.

The combination of slowing productivity and rising wages was seen as a formula for inflation troubles down the road. It could keep the Federal Reserve from cutting interest rates any time soon and possibly lead to another increase.

Productivity, the amount of output per hour of work, showed no growth at all from July through September. Growth was just 1.3 percent over the past 12 months, the weakest showing in nine years. The cost of wages and benefits measured by each unit of output grew at an annual rate of 3.8 percent in the third quarter.

Employee compensation climbed by 5.3 percent over the past year. That gain matched a 12-month increase ending in late 1990 and was the fastest since a 5.8 percent rise in the 12 months ending in the fourth quarter of 1982.

Both the extent of the weakness in productivity and the size of the increase in unit labor costs caught analysts by surprise. They said the numbers were certain to raise concerns at the Fed about future inflation risks.

MORE

[WCGreen]

18. It almost always happens when "officail" Uemployment figures

dip below 5%...

[DBoon]

19. so the fact that wage increases no longer suck is BAD news?

Those uppity workers are making more - time to slow down the economy

[Rex]

20. Such lies.

They won't be able to hide the real damage for much longer.

[FormerOstrich]

22. I'm having trouble...

comprehending what they are saying here.

To start with I think it should come to as no surprise that increases in productivity are slight. Corporate downsizing, rightsizing, outsourcing, and layoffs result in expecting more work from less employees. There comes a point when you can't eek much more output from what you have.

I find the raise in wages very suspect. If that is true there must be some identifiable circumstance to which it can be contributed. For instance, perhaps does this include any corporations which had massive layoffs and paid severance packages or early retirements? Frankly, I wouldn't be surprised if they haven't found some way to factor in the cost of off-shoring into the labor calculations.

The article doesn't say if this was based on GNP or GDP.

I just can't help but getting the feeling this is ramp up for justifying why us peons are about to be shafted even more. With a recession on the horizon and winter near condition us peons about how we are cold and hungry because we are lazy slobs.

[w4rma]

26. mean wages or median wages? My guess is mean wages, which don't mean squat. (nt)

[krispos42]

27. We pretend to work, they pretend to pay us.

And they pay us weakly. Very weakly!

LMAO

I can't complain, I actually work for a start-up place that treats us employees pretty nicely. But I feel it's the exception, not the rule.

[xchrom]

28. financial institutions want their cut.

wages go up?

raise interest rates.

productivity slows?

raise interest rates.

corporate institutions see in the workers an ever repelenshing gold mine.
that works best when the workers are kept constantly under a tight, tight squeeze between debt and the threat of off-shoring, lay-offs, and down sizing.

and we musn't have any government provided benefits like healthcare -- that would interfere with the flow of gold into the corporate coffers.

[struggle4progress]

29. I've been trying to find the data. I can't. I think the wage "data" are all projections

based on "benchmarks" from 2005 due to be updated in 2007, basaed on what I find at the Labor Department.

And good luck finding anything useful on the Commerce Department website ( http://www.commerce.gov/index.html ) because the lead story "COMMERCE SECRETARY GUTIERREZ HAILS TUMBLING UNEMPLOYMENT RATE" links only to "White House Fact Sheet on Jobs and Economic Growth" which doesn't link to anything useful.

And applying a search engine to the Commerce Site looking for wage info merely turns up a few bits of odd junk like "GUTIERREZ HAILS TUMBLING UNEMPLOYMENT."

My conclusion? This ain't reality-based: it's the usual huff-n-puff.

[Megahurtz]

30. Yeah, a lot of INCENTIVE in Today's Economy for Productivity.

:sarcasm: