The Washington Post's cerebral economics reporter Neil Irwin takes a long walk to explain a short concept in an article today on why improving worker productivity is dampening hiring but the detail is worth it.
As best as anyone can guess, the crisis that began in 2007 and deepened in 2008 caused both businesses and workers to panic. Companies cut even more staff than the decrease in demand for their products would warrant. They were hoarding cash, fearful that they wouldn't have access to capital down the road.When demand for their products leveled off in the middle of last year, the companies could have stopped cutting jobs or even hired people back. But they didn't -- payrolls have continued declining.
Instead companies squeezed more work out of remaining employees, accounting for a 3.8 percent boost in worker productivity in 2009, the best in seven years.
Usually, when the boss gets to insistent on overworking someone, he or she quits and gets another job. Can't do that right now, so productivity keeps rising.
Irwin's story is rich in detail and data so it rises above other stories of this type even if the premise and conclusion are kind of obvious. He's one of the few prominent business writers at the Washington Post who covers issues beyond the immediate area of D.C. so if you've done your homework and can document a trend, he's worth approaching.
Comments