Downward productivity revision coming

Posted by: Michael Mandel on August 07

Tomorrow’s numbers from the BLS are likely to show a sharp downward revision in productivity growth for 2004 and 2005. Instead of an average productivity gain of 3.0% for those two years, the new pace is likely to be closer to 2.5% or 2.6% (this is based on looking at the revisions in the latest GDP release).

This raises the worrisome possibility that the productivity boom may not have been as strong as we thought.

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Reader Comments

Kartik

August 7, 2006 01:27 PM

Noooooooooooooooooo!

The single most valuable long-term statistic is going to be revised downward. This also means that a recession in 2007 is more probable than before..

Mike Mandel

August 7, 2006 03:13 PM

I don't like it any more than you do.

crack

August 8, 2006 09:19 AM

Any word on what is causing the revision? What got missed?

Jim Haggerty

August 8, 2006 10:04 AM

Michael,

What are your thoughts on this morning's productivity numbers?

Alex S. Gabor

December 12, 2006 12:21 PM

How do you spell government fraud and corruption?

D O W N W A R D R E V I S I O N...

Brandon W

December 12, 2006 02:26 PM

As the resident cynic, I am not remotely surprised and haven't bought into the reported productivity numbers for a long time. Seriously folks, do you really think we've entered a new era of productivity growth? Computers were a little boost and Internet availability kicked it up a notch, but that's all worked in to the equation at this point. It doesn't matter how fast computers are; human beings can only work so fast. A lot of the productivity growth lately has been from squeezing more work out of fewer people for less pay. Look at the median income, particularly for those recently entering the workforce with a bachelor's degree. They're gullible enough to accept ever-lower "entry-level" pay for more "mid-level" work. And why not? What's their option?

I think our problem - nationally - is a downward spiral of innovativeness and entrepreneurialism (no, opening another lousy Starbucks franchise doesn't count); and I think I know what the cause is. But that's another discussion.

Brandon W

December 12, 2006 02:29 PM

Though, it occurs to me after I hit "Post" that Starbucks doesn't franchise. So let's just insert "McDonald's" or "Goin' Postal" and call it a day.

Thank you for your interest. This blog is no longer active.

 

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Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.

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