Productivity is the wrong thing to measure

Nipawin - December 30, 2000 - by:Mario deSantis


We live in an environment where there is a lot of confusion, and this confusion is being made
more confusing by an obsolete leadership unwilling to make personal transformational changes
and unwilling to give power away. As I have already mentioned in a previous article, our
leadership is continuing to use a manufactured language which divides people rather than
unites them(1). And this manufactured language is used in our educational institutions, in
politics, in business, in our communities, and in our families. We are today living in a rapidly
changing world which has been characterized by the so called New Economy, and yet we
describe this New Economy in terms of our old manufactured economic language. As I was
saying , our social state of confusion is getting more confusing.



at work

What has caught my attention lately has been the social misunderstanding of the economic
term "productivity." I really loved my figuratively definition of productivity as "the work of
our imagination at work(2)" as contrasted to the traditional definition which equates
productivity to per capita GDP (Gross Domestic Product).



technological advances

We are living in a changing economic environment where products and services keep
changing in accordance to our technological advances and new ideas, and yet our
economists are still putting their emphasis of economic growth on "productivity." In the
United States, we have progressive economists Robert Atkinson and Randolph Court,
who have confirmed that in the New Economy we are experiencing both a growth of high
and low skilled jobs(3).



Lagging productivity

These economists say "Low-skilled jobs are not going away any time soon. The
occupations with the largest predicted numerical increases are cashiers, janitors, retail
salespersons, waiters, and waitresses. Together, they are expected to account for thirteen
percent of all new job growth." Atkinson and Court continue to say "Lagging productivity
goes a long way towards explaining slow wage growth. If productivity had increased after
1973 the way it did in the thirty years before, half of all American households would now be
earning at least $63,000, instead of the current $37,000"




In one way, and indirectly, Atkinson and Court are telling us that in the New Economy, the
traditional economic measure of "productivity" doesn't make sense. Productivity, as per capita
GDP, doesn't make sense because goods and services keep constantly changing, and because
in this stage of the New Economy both high and low skilled jobs are increasing. However, our
journalist Bruce Little of the Globe and Mail says "productivity is important because it's the
foundation of prosperity and a rising standard of living(4)", and this statement characterizes
the demented mind set of our traditional economists and leadership.




Let me reinforce the understanding that productivity is an obsolete economic term and that
it should not be part of our economic vocabulary. Productivity, as per capita GDP, is a
manufactured economic term of the assembly line economy, and it has no meaning in the
New Economy. And very perceptively, Kevin Kelly has stated that "the problem with trying
to measure productivity is that it measures only how well people can do the wrong jobs. Any
job that can be measured for productivity probably should be eliminated(5)."
  List of relevant political and economics articles


Money Talks, Mandatory Voting and our Democracy, by Mario deSantis, December 23, 2000


What is productivity? It is the work of our imagination at work, by Mario deSantis, September 5, 2000


The New Economy Index, by Dr. Robert Atkinson and Randolph Court. Dr. Robert Atkinson is the director of the Progressive Policy Institute's project on Technology, Innovation, and the New Economy. Randolph Court is the technology policy analyst at the Progressive Policy Institute


Too early to tell if our productivity will match U.S. boom, Bruce Little, The Globe and Mail, Monday, September 4, 2000


New Rules for the New Economy. Twelve dependable principles for thriving in a turbulent world. By Kevin Kelly, Executive Editor, Wired Magazine Group Inc., F E A T U R E S | Issue 5.09 - September 1997