Recent trends in productivity growth make it hard to be optimistic about the future. But some historical perspective is in order: When radical innovations are first rolled out, their immediate effect is to reduce, not raise, productivity.
NEW YORK – Recent trends in productivity growth make it hard to be optimistic about the future. In 2014, the global growth of total factor productivity, or TFP, which measures the combined productivity of capital and labor, was essentially zero for the third consecutive year. This was down from 1% in 1996-2006 and 0.5% in the crisis years of 2007-2012. And, by every indication, 2015 has been no less dismal. In the US, revised data released at the beginning of December show productivity up only 0.6% year on year in the third quarter.
NEW YORK – Recent trends in productivity growth make it hard to be optimistic about the future. In 2014, the global growth of total factor productivity, or TFP, which measures the combined productivity of capital and labor, was essentially zero for the third consecutive year. This was down from 1% in 1996-2006 and 0.5% in the crisis years of 2007-2012. And, by every indication, 2015 has been no less dismal. In the US, revised data released at the beginning of December show productivity up only 0.6% year on year in the third quarter.