December 8, 2017

Labor Productivity Is Just Terrible These Days

Jobs figures for November will be released in a couple of hours, and the consensus forecast is that they’ll be fine. While you wait, however, here’s another chart to look at:

Productivity growth has dropped like a stone since 2005, and is currently hovering around 1 percent per year. That’s terrible. Unemployment is at 4 percent, which means businesses are employing a lot of people, but low productivity growth means this employment is only in lieu of investing in labor-saving machinery. After all, why bother with a big capital expenditure when future growth looks iffy and wages are flat? It’s easier and more flexible to just hire some cheap workers who can be laid off if business sours.

There’s probably something of a pent-up demand right now for labor-saving equipment, and the Republican tax bill’s bizarrely enormous incentive to pull all investment into 2018 might be just the thing to kick it off. If that’s really the case, we can kiss off any chance of sustained wage growth in the near future.

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We just wrapped up a shorter-than-normal, urgent-as-ever fundraising drive and we came up about $45,000 short of our $300,000 goal.

That means we're going to have upwards of $350,000, maybe more, to raise in online donations between now and June 30, when our fiscal year ends and we have to get to break-even. And even though there's zero cushion to miss the mark, we won't be all that in your face about our fundraising again until June.

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