Bacon's Rebellion

Democracy Thrives in Sunlight

Enjoy Labor Day… Then Get the Hell Back to Work!

—

by

James A. Bacon
in

Labor productivity is one of the key determinants of material prosperity in any society. On this Labor Day, Americans can take some satisfaction in the fact that they have the most productive workforce in the world, according to the U.N. International Labour Organisation.

According to the U.N. report, “Key Indicators of the Labor Market,” the United States recorded the world’s highest labour productivity levels in 2006, measured as value added per person employed per year, at $63,885. The U.S. was followed, “at a considerable distance,” the report notes, by Ireland $55,986 and Luxembourg at $55,641. How about that — Ireland and Luxembourg as No. 2 and 3. Somebody take a look at what those two countries are doing right!

The productivity gap between the U.S. and most other advanced industrial countries continued to widen in 2006, the report stated. Spunky little Ireland, the world success story for rapid productivity growth, was an exception. Productivity growth was stellar in fast-developing East Asian economies as well.

Americans owe some of their high productivity to a willingness to work longer hours than most other nationalities in the developed world. However, judged on value added per hour of work, Norway led the way ($37.99). The United States ($35.63) came in second, followed by France ($35.08). Moral of the story: It pays to work hard. But it also pays to work smart.

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13 responses to “Enjoy Labor Day… Then Get the Hell Back to Work!”

  1. Anonymous Avatar
    Anonymous

    Amazing that Americans are so productive and yet they are not really rewarded for what they do. Wages are stagnant or declining (while CEOs net more by a factor of 500). The U.S. isn’t in the top 10 in health care or longevity. They get a puny two weeks off a year while their European counterparts get five or six weeks.
    No, the poor U.S. worker is downtrodden, a slave to uncaring corporations who severed any loyalty years ago. I wonder where all that wonderful productivity goes.

  2. E M Risse Avatar
    E M Risse

    There are, as Anon 9:55 suggests, a lot of ways that “workers” and citizens in general are slipping behind those in other nation-states.

    There is, however, more good news on productivitiy in the WaPo first page coverage of North Carolina Manufacturing.

    Perhaps Jim Bacon can use his skills to post in this string the two graphics on the jump page of that story. (and the cite too) for those who do not have WaPo on their lawn chair or their Favorites list.

    Of course our point is that with functional human settlement patterns we could take advantage of all that hard work and innovation and have the luxuray of more time in the lawn chair, going for a hike or doing something else “recreational” and is “re-createive.”

    EMR

  3. Anonymous Avatar
    Anonymous

    We could take advantage of all that hard work and innovation and have the luxury of more time in the lawn chair if we simply stopped doing all the nonsense that just isn’t necessary.

    Keeping up witht the Joneses, suing each other over imaginary slights and damages, incessant meaningless bureaucracy, irrational competition, and false alarmism come to mind.

  4. Anonymous Avatar
    Anonymous

    Sorry, EMR, the Washington Post story is way too cheerful about North Carolina. This reinventing idea is just what the EDAs and the free-traders would like to have us believe just like the crap that with NAFTA and other one-sided trade pacts, all boats rise.
    Try telling that to the former textile workers in Kannapolis who were laid off by the thousands in one afternoon not long ago. Ditto Philip Morris workers. The bosses want us to drink this Kool Aid since they improve their margins by exporting jobs. But as a former Tar Heel I can tell you reality is very much different.
    You might want to get out of the ivory tower of NOVA and take a drive down there. Walk into a Shoney’s and start citing your rosystats. See where it gets you.

  5. Anonymous Avatar
    Anonymous

    Say, Ed.

    You picked up on the NC article, but left out Joel Achenbachs article, “Forget the Doom and Gloom, In 50 Years We’ll Still be Number One.”

    RH

  6. Anonymous Avatar
    Anonymous

    One sided trade agreements?

    If I cannot produce something cheaper than my competition, why should I try? I can buy it cheaper than I can make it, and apply my energies (and the cash I saved)eleswhere.

    A trade agreement that artificially keeps me in business is bad for both sides.

    Are there serious dislocations? You bet, but the alternative is even worse

  7. Anonymous Avatar
    Anonymous

    Anon:
    Sure the Chinese produce goods cheaper than the U.S. That has been the mantra for two decades now as the laud for China grew louder.
    Now, we are finding that those cheaper goods aren’t up to snuff or even sniff if it’s lead-poisoning, poisoned cat food or whatever. Meanwhile, the Chinese “miracle” is polluting the earth faster than anything that anyone’s ever seen. And, their cheap prices result from a lack of the most basic type of safety regs. Their coal mines loose something like 50,000 lives a year. We lose a few dozen.
    So before you start touting “price” you might want to think what the hidden “costs” really are. We are only starting to pay for them.

  8. Anonymous Avatar
    Anonymous

    You are correct. My argument only holds for “equivalent goods”.

    This isn’t something new. In the era of the tea trade, every box of tea had to be unpacked weighed and repackaged before it went on the ship. Otherwise there would be boxes eith false bottoms, boxes with tea on top and fller underneath etc. The Chinese have long been known as sharp traders.

    In the U.S. the fallout the type of thing you mentioned falls on the importer/distributor. The U.S. toy companies and a tire company have taken a beating for inadequate supervision of their suppliers.

    If we are not getting “equivalent goods” it is (partly) our own fault. Or, we know we are not getting equivalent goods, and are not willing to pay the price to get them.

    It is also true that the U.S. sends tons of goods back to China to be recycled. Electronic equipment for one. However, it is only possible to recycle the stuff economically because of a) cheap labor, and b)lax environmental laws. You would have a hard time getting a permit to leach gold with acid in the U.S., for example. If you did get the permit, the requirements would probably make the process uneconomical. At least some of China’s environmental problems are exports from the U.S.

    This problem boils down to this: do you not recycle and accept the waste, or is it better to recycle badly and accept the processing pollution as a lesser evil (preferably someplace else)?

    You are correct that we are paying a low price because we are avoiding many U.S. “costs”. You are also correct that we are only starting to pay for them. You can bet that increased vigilance in the future by HASBRO toys will mean toys cost more.

    China isn’t alone. Japan has located their steel industry in the Northeast Corner of the country. Their pollution control consists of the Pacific Ocean. At the same time, U.S. soybean endors have a hard time meeting Japanese regs for soybean cleanliness. One exporter resorted to a process that cleans each bean individually.

    But, overall, I accept your argument.

    Now go back to the original (unstated) premise of equivalent goods. Assume your objections are overcome through additional trade regulations and purchasing oversight, so that we have equivalent goods, produced with equivalent safety and environmental protection. Will China and other countries still have an advantage in producing certain goods?

    I suspect that until our quality of life is equivalent, that they will. They will have more incentive to become as rich as us than we have to pay them to improve their environment and safety.

    A quality environment is a costly luxury, and also a necessity. Until we are really willing to recognize the costs, and pay for them, we will continue to get our environmetal luxuries by exporting the costs to others. We do it locally and regionally here at home, and we do it abroad as well.

    RH

  9. E M Risse Avatar
    E M Risse

    At 11:53 AM, Anonymous said…

    We could take advantage of all that hard work and innovation and have the luxury of more time in the lawn chair if we simply stopped doing all the nonsense that just isn’t necessary.

    THE KEY IS DEFINING “NONSENSE.”

    1. Keeping up witht the Joneses,

    2. Suing each other over imaginary slights and damages,

    3. Incessant meaningless bureaucracy,

    4. Irrational competition, and

    5. False alarmism

    come to mind.

    THEY MAY COME TO MIND BUT WHAT DO THESE MEAN? SINCE YOU ARE THE WELL KNOWN SCHOLAR ON THE TOPIC OF COMPETETIVNESS “Anonymous 11:53” PERHAPS YOU ARE ON TO SOMETHING IMPORTANT WITH EACH OF THESE.

    WHAT IS IT THAT YOU HAVE IN MIND?

    EMR

  10. Anonymous Avatar
    Anonymous

    Look at it another way. We could import another 30 or 40 million workers. That would lower the cost of labor here, and we could produce our own goods under our own environmental and safety rules.

    Considering the current hubbub over foreign workers, that is unlikely. And of course we would have to provide for another 30 or 40 million, and all the waste they produce.

    But, taking all that work from overseas you would make them even more desperate. They will still have more unemployed, willing to work for less, and they still won’t have our safety and environmental rules.

    Would you rather have low wage people working for you here, or low wage people someplace else competing against you?

    RH

  11. E M Risse Avatar
    E M Risse

    At 1:09 PM, Anonymous said…

    Sorry, EMR, the Washington Post story is way too cheerful about North Carolina. This reinventing idea is just what the EDAs and the free-traders would like to have us believe just like the crap that with NAFTA and other one-sided trade pacts, all boats rise.
    Try telling that to the former textile workers in Kannapolis who were laid off by the thousands in one afternoon not long ago. Ditto Philip Morris workers. The bosses want us to drink this Kool Aid since they improve their margins by exporting jobs. But as a former Tar Heel I can tell you reality is very much different.
    You might want to get out of the ivory tower of NOVA and take a drive down there. Walk into a Shoney’s and start citing your rosystats. See where it gets you.

    ACTUALLY, I HAVE SPENT A LOT OF TIME WORKING IN THE CAROLINAS AND GEORGIA. MUCH OF WHAT YOU SAY IS CORRECT BUT THAT IS NOT WHAT I WAS TALKING ABOUT.

    I WAS TALKING ABOUT THE TWO GRAPHICS THAT GO WITH THE STORY. THEY ARE VERY IMPORTANT.

    THEY SUGGEST IF WE WERE TO BEGIN THE PROCESS TO EVOLVE BALANCED COMMUNITIES IN FUNCTIONAL NEW URBAN REGIONS SOON, THERE IS HOPE TO ACHEIVE A SUSTAIANBLE TRAJECTORY.

    EMR

  12. Anonymous Avatar
    Anonymous

    Gee, Ed. I’m on your side here.

    You have freqquently written about unnecessary overexuberant consumerism. Running as fast as they can. That is what I mean by keeping up with the Jonses.

    You have written about our winner take all attitude. That’s what I mean when I say irrational competition. We are sometimes like hummingbirds fighting over the feeder when there is plenty of sweetwater for all.

    By meaningless bureaucracy, I’m thinking of things like banning outdoor clotheslines in the face of energy shortages, or the HOA that banned someone from putting out some solar garden lights. I’m thinking about the planning board that told a homeowner that reparing a fence on town property behind his house was the owners responsibility, approved his plans, and then fined him for doing the work on town property.

    We are not at odds over what needs to be done. This is all stuff that we can do to help prevent waste, save ourselves money, resources and time.

    I don’t see the problem.

    RH

  13. Anonymous Avatar
    Anonymous

    For what it is worth here is some of what Wikipedia has to say about productivity.

    “….One important reason is that aspects of productivity refer mainly to its qualitative, rather than quantitative, dimensions. We might be able to observe definite increases in output, even though we do not know what those increases should be attributed to.

    This insight becomes particularly important when a large part of what is produced in an economy consists of services. Management may be very preoccupied with the productivity of employees, but the productivity gains of management itself might be very difficult to prove.

    This may mean that a lot of what is said about productivity is based on opinion, rather than empirical evidence. Modern management literature emphasizes the important effect of the overall work culture or organisational culture that an enterprise has. But again the specific effects of any particular culture on productivity may be unprovable.”

    So how is productivity measured? GNP/Hours of Labor?

    Norway has the benefit of enormous North Sea oil wealth. Does that affect their apparent productivity?

    RH

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