Productivity, jobs, supply and production

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A New York Times column recently explored the gap between high employment and low economic output.

There was a striking paragraph in the article which stated that ‘high demand for workers’ has forced us to bring in less productive workers who under normal circumstances would not be active or employed,” Diego Comin wrote, a Dartmouth College economist who studies productivity, in an email: “My 15-year-old son, who is anything but productive, keeps getting service-sector job offers that seem attractive, even to me. »

The report says people laid off in “low-wage positions during the pandemic are back on the job, making productivity growth slow or negative.”

The problem with labor productivity – output per hour – is not workers or pay, but sectors and roles.

There was a recent report on Bloomberg that the United States is experiencing a factory boom: more factories, more productivity.

Part of the problem of low productivity is the imbalance between the manufacturing economy and the service economy. Many manufacturing jobs are being offshored due to lower minimum wage rates, but the challenge is how wages can be competitive enough for high productivity, with low labor costs.

Those who would not be “active or employed” can be hired in a lower level model, where they can earn around half minimum wage, to work only 2 hours per slot.

This means that the pay is still low, but the hours are short enough to feel fair enough, or not to demand more than can be offered, with recovery energy almost intact, far from the fatigue of long hours.

The Bloomberg report noted that “the construction of new manufacturing facilities in the United States has soared 116% over the past year, eclipsing the 10% gain on all construction projects combined, according to Dodge Construction Network.”

If the boom finds a way with cheaper labor costs, it could become a lasting permanence in the making of things and resistance to supply shortages that may arise in the future.

There’s a report on The Register about the shortage of electronic engineers in the semiconductor industry. Major players in the sector, opening manufacturing plants to be active in a few years, seek to train or prospect electronic engineers.

School is a pipeline, but level work also applies. There could also be a supervisor or a few for dozens of lower level workers with a track to becoming the second or first level in the future.

There would always be people hired higher, but lower level workers would become a major approach to labor surplus in a win-win, towards better results.

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