>Is not the "productivity" measure really an indicator of the value of
>the output per worker, rather than unit of labor (ie. hour or FTE
>worker)? With that in mind - longer ours worked will show as "higher
>productivity" even though the actual productivity per unit of labor is
>the same or lower. Mind that the US is the only industrialized country
>that does not have any legally mandated vacation time, and paid vacation
>is about a third of that in Europe.
>
>Another issue - such a productivity measure is affected by the dollar
>value of the output. So say, if a sector of the US industry employs an
>X number of people in the US and has an output of Y dollars, the
>productivity would be Y/X -even if some of that Y was produced overseas.
>Stated differently, the actual measure of productivity of that US firm
>should be measured as Y/(X+Z) where Z represents foreign labor working
>for that company but disappearing from the equation through internal
>transfers within the multinational corporations.
>
>So the bottom line is that the supposed higher productivity of the US
>firms is likely an artifact of longer working hours of the US labor and
>foreign labor that is not accounted for.
>
>Am I missing anything? Doug?
The standard measure of productivity is per hour worked. There are also output per worker calculations, but those are often done when comparable hourly data isn't available.
Many European countries have hourly productivity stats matching or exceeding the U.S. - but we have more people working longer hours, so our aggregate GDP is higher.
The foreign labor input issue is complicated. The BLS told me that work done abroad counts as value added abroad, and therefore isn't part of the output figure. There may, however, be a problem with valuing the labor inputs in purchased components.
If you read the productivity stats as a measure of labor exploitation, it's not hard to see why the U.S. does well. We work people til they drop and pay them crap.
Doug