 Email |
 Print |
 Post Comment
|
Share |
|
|
|
 |
|
|
From the official word on what’s been driving long-term productivity growth to unofficial survey results indicating what’s been derailing it, here’s our productivity scorecard:
| Related Stories |
| Managers Encourage Steroid Use to Boost Productivity |
| In the Race for Success, Quality Trumps Productivity |
| Too Much of a Good Thing: Is Productivity Hurting Job Growth? |
The Big Picture
There’s no getting around it…productivity is critical. In a deluge of statistics about the U.S. economy, productivity (measured by the U.S. Department of Labor as “output per hour of all persons”) is a standout. A recent Newsweek item points out that this “pivotal” figure “allowed for the virtuous circle of high growth, low unemployment and low inflation that described the much-envied U.S. economy of the past decade.”
As the U.S. Dept of Labor puts it, “advances in productivity, that is the ability to produce more with the same or less input, are a significant source of increased potential national income.”
And beyond its national implications, Morgan Stanley chief economist Stephen Roach, calls U.S. productivity the “holy grail of the global economy” as other countries depend heavily on American spending as an engine for growth.
Here’s the big productivity picture… Basically, in the 30-year span from 1973 to 2003, U.S. productivity grew fast, then faster and then picked up even more speed.
From 1973 to 1995, it grew an average of 1.5% annually. Then, in the late 1990s, U.S. productivity increased at a more rapid pace (approximately 2.5% annually) and continued to soar even after the tech bubble burst in 2000. In fact, the Newsweek story reports that it increased a remarkable 4.3% annually between 2001 and 2003.
What drove such high growth rates for productivity? A major driver is new technology, from speedier, more affordable computers to more efficient machine tools, which continued to boost productivity even after the bubble burst. Additionally, businesses became better configured to make use of technology.
Now, after such a torrid pace of productivity growth, we’re back to, in Fed chairman Alan Greenspan’s words, “respectable” but hardly extraordinary numbers.
The Bureau of Labor Statistics reports that for the first quarter of 2005, the annual rates of productivity gain were as follows…
2.6% in the business sector and
2.9% in the nonfarm business sector
What does this mean? Should we be concerned? According to Newsweek, not quite yet. “The truth is, after a mere quarter or two, nobody can know for sure whether the tech boom is over,” says the feature. In short, the jury’s still out.
Survey Says
Meanwhile, let’s take a look at some less official, but still intriguing, findings on productivity.
One recent survey found that workers are productive only 3 days per week. The online survey by Microsoft Corp. collected responses from more than 38,000 people in 200 countries, rating workers’ productivity based on how they responded to 18 statements about their workplace. Here are some of the U.S. findings (as reported in this item from The Business Journal of Milwaukee):
• Employees work an average of 45 hours a week; 16 hours are considered unproductive.
• Approximately 16% of participants relate their productivity directly to their software.
• Only 31% said they are using proven scheduling tools and techniques.
• Women had an average productivity score of 70%, while men were at 68%.
• Workers said they receive an average of 56 e-mail messages per day.
• The most common productivity problems are:
1) procrastination, 42%
2) lack of team communication, 39%
3) ineffective meetings, 34%
Speaking of wasting time, another online survey found that U.S. workers waste over two hours a day at work–more than double what most U.S. companies expect–at a cost of $759 billion in annual paid salary. (The two hours do not include the standard lunch hour). Reuters reports that the America Online and Salary.com survey received responses from 10,044 employees. Some of the findings:
• While 33% said they indulged in productivity-draining activities because they didn’t have enough work to do, nearly a quarter reported that they slacked off because they were underpaid.
• Men and women reported equal amounts of wasted time at work.
• Older workers appear to be significantly more productive than younger ones, as respondents over 55 years old said they wasted an average of just 30 minutes a day.
• The most common time-wasting activities: surfing the Internet, chatting with co-workers and just “spacing out.”
Here’s another interesting productivity study featured in Entrepreneur magazine, this time delving into how office temperature affects productivity. It turns out that temperature is a factor, as chilled workers experience a drop in their productivity. The study conducted by Alan Hedge, professor of design and environmental analysis at Cornell University, suggests that 77 degrees is much more conducive to productivity than 68 degrees.
Sampling the air every 15 minutes at nine workstations in an office, the study tracked the time the workers used their keyboards and the time they spent correcting their mistakes. At 68 degrees Fahrenheit, workers typed 54% of the time, with a 25% error rate. In contrast, at 77 degrees, the staff typed 100% of the time, with a 10% error rate.
A more comprehensive study is planned for August.
| Share | |
|
|
|
|
Follow Discussion
Recommend 
See More Comments
See Less Comments
|
||||
|
||||
|
Advertisement
|
Browse IMT by Date
Browse IMT by Date
| Also Featured in IMT |
| Expert’s Corner |
| How Food Companies Can Trim the Fat |
| The food industry is struggling to cope with market fluctuations. In this Expert’s Corner, Jonathan Daiker, a partner at CFO services firm the Interlochen Group, identifies strategies to stabilize costs and boost profits. |
| Sites We Like |
| Harvard Business Review |
| IEEE Spectrum |
| Lifehacker |
| Popular Science |
| Shopfloor |
 |
What is not represented in this article is how many people are working a lot more hours because of lay-offs in their company have reduced the work force, but the work stayed the same. Then the people let go find work they are usually over-qualified for and probably are not as challenged, therefore not as productive. Also, all the training for these people changing jobs due to lay-offs helps reduce the productivity. I don’t feel there is a good survey at present that accomodates the whole picture on productivity. There are some that are good indicators, but that is about all.
Having worked on and designed high production machinery, I have often wondered what would happen when all countries have the capacity to produce on these same type of equipment. We will find out in the near future. (It came sooner than I imagined) My opinion is that humanity will be forced to produce only for their immdiate needs. Reason being that we now have the capacity to overproduce just about everything.
We may run out of natural resources first. Man needs first to stop reproducing himself!