One of my favourite blogs is Evolving Excellence, dedicated to Lean Thinking in production and services. Outspoken, opiniated but well researched, practical.
Bill Waddell , one of their prominent bloggers referred in one of his blogs to a stunning fact.
The productivity statistics as published by the Bureau of Labor Statistics of the USA are fundamentally flawed and overrate the actual productivity.
“Conceptually, the impact of offshoring is more pronounced in manufacturing measures than in business sector measures, provided the domestic manufacturer is purchasing the offshored goods or services as inputs. … If a domestic computer manufacturer switches from domestic to foreign suppliers of intermediate parts such as memory chips or call center services, real manufacturing sectoral output is unchanged because the real value of the computer is unchanged. Because U.S. jobs are lost (all other things unchanged), labor productivity will rise. If the U.S. manufacturer switches most of its production to off-shore facilities, labor productivity might rise substantially.”
As Bill says ” In other words, if the furniture factory lays off all of the people who make legs, seats and backs, and buys those parts from China, but keeps the few people who do the final chair assembly, the jobs lost to China are called “productivity”.”
I remember all the economists and journalists praising the USA for its high productivity growth, compared to the EU. The better system…
Apparently at least a part of it was a (convenient) damn lie, keeping the foreign investment dollars coming to the USA.
About Herman
Herman Wagter is one of the founders and co-editor of Dadamotive. His work as interim manager and consultant (Citynet Amsterdam/Fiber-to-the-Home, Platform Sustainable Mobility) has involved him directly in the impact of hyperconnectivity and sustainability on society. As an independent agent and "mobile warrior" he has experienced the pro's and con's of how organizations and projects can be structured, and what the effects on the final result can be. In his opinion we are entering an era of profound change, driven by these fundamental forces. Following the trends, discovering the fun and debunking the half-truths is a passion he likes to share with others.
