Did you notice that “productivity” consistently goes up when joblessness goes up?
Question by gws35: Did you notice that “productivity” consistently goes up when joblessness goes up?
http://www.marketwatch.com/story/treasurys-up-as-jobless-claims-unexpectedly-rise-2010-02-04?reflink=MW_news_stmp
Treasurys advance after weak jobless claims report
“First-time unemployment claims rose 8,000 to 480,000 in the latest week…
“A separate report Thursday said U.S. productivity rose 6.2% in the fourth quarter, slower than in the third quarter. Unit labor costs fell for the quarter and all of 2009, easing some concerns about inflation.”
Did you ever notice that “productivity” almost always goes up when joblessness goes up?
That’s because “productivity” is calculated by industrial output divided by number of workers.
So if the number of workers goes down, the “productivity” statistic goes up, just by simple math.
But thanks to the dumbing down of America, most people can’t do math well enough to understand that, so they are easily fooled by the bogus “good news” that productivity is up.
Productivity up = jobs down. It’s that simple.
Pfo, yes thanks for reminding me.
Industrial output remains the same because after the job cuts, the remaining workers are worked harder. Often their employers coerce them into working unpaid overtime under threat of losing their jobs next. So even if productivity is counting worker hours, those hours are understated during times of high joblessness.
Sadcat, but usually that does NOT happen.
We consistently see a rise in productivity when joblessness rises.
There may be rare exceptions, but in actual fact those are few and far between.
Bill, THANK YOU, that is another excellent example of the same mathematical principle!
Best answer:
Answer by Pfo
It’s a little more than that even. As some get laid off, those who don’t take on increased responsibilities. They do more work for the same pay, more gets done with fewer workers. Of course productivity is going to go up!
It is also possible for productivity go up while employment remains, or grows even, but when this happens it’s not by much usually.
Know better? Leave your own answer in the comments!
Because the deadweight “workers” who do not pull their own weight are the first to be laid off, or weeded out, from any company when the layoffs begin.
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LikeDislikeIt’s not quite that simple. If the number of workers declines, but industrial output PER WORKER also declines, then productivity and jobs can both decline at the same time. You’re leaving out the issue of worker productivity on a per worker basis.
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LikeDislikePeople work harder to keep there jobs and companies find ways to become more efficient to cut costs.
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LikeDislikethe libs dont wwant to creat jobs.they want to live a lie that healthcare is free and every thing is great
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LikeDislikeKarl Marx said, “Capitalism works best when there is a large pool of skilled workers unemployed, willing to work”
America is so close to his idea of perfect Capitalism, hows that working for ya?
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LikeDislikeIf businesses are laying off the right people, yes, it makes sense. Getting rid of the unproductive is a solid business plan.
Watch out if tax rates increase or some other disincentive convinces the most productive to leave and they stop working.
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LikeDislikeInflation goes down as joblessness goes up too so wippee! =D
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LikeDislikesame as gold up, dollar down. just thought I’d mention it.
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