The Wall Street Journal recently reported that future interest rate increases might be deferred based on steadily declining worker productivity over the past decade. The paints a dire picture of what has happened to US worker productivity over that period.
So what is really happening with worker productivity? Should we be worried? The slow-down in recent quarters has likely been reinforced by weak business investment in new equipment, software and facilities.
The global financial crisis clearly has impacted these investments, as we are not yet completely out of the global economic crisis that began back in 2007-2008. Given these declines, companies now face new challenges when seeking to improve their worker’s productivity.
One of my favourite expressions is the definition of insanity: Doing the same thing and expecting different results. Managers pursuing the same productivity improvement strategy while expecting different results fall into this definition. Now is the time to rethink how productivity can be improved, which starts with examining how it can be measured.