Vanishing Vigor

Worker output slackens around the world

Since productivity is a key indicator of a nation's economic vigor, the figures issued last week by the Labor Department made sober reading. According to the study, 25 of 66 major industrial groups showed outright declines in the hourly output of their workers in 1977. As a whole, the rate of rise in productivity in the manufacturing sector slowed markedly last year to only 2.2%, vs. 6.8% in 1976. The biggest drops were in clay-working (down 7.4%), grain-milling (7.1%) and footwear (4.3%) industries. Productivity in the coal industry fell by 1.2%.

The department's figures for the first quarter of this year were even worse. Due to the blizzards, manufacturing productivity showed a 3.3% decline. The rate may recover, but 1978 results are likely to be slightly lower than last year.

Economists largely blamed the poor American showing on three factors: lagging outlays in research and development, which have slowed the rate of laborsaving innovation in U.S. industry; a paucity of capital investment necessary for the purchase of more productive machines; and the upsurge in costly federal environmental and safety regulations, which often handicap plant efficiency.

The disappointing U.S. figures are part of an international economic trend that marks the close of the recovery from the 1974-75 recession. Throughout most of Western Europe, productivity increased last year at a slower rate than in 1976. And even the Japanese, whose productivity growth has sometimes been sensational, had to settle last year for an advance of only 6.1%.

This file is automatically generated by a robot program, so viewer discretion is required.