bulliesptnetThe gentle art of productivity motivation

GLOBALISTS PUZZLED: “We’ve cut labour costs but productivity is falling. Why?”

Here comes another of those realities that keeps ‘surprising’ those who hold the works of Friedman in high esteem: productivity in areas of static or negative blue collar income growth is falling.

This is a chart of the state of affairs in the home of Devil take the Hindmost, the US of A:

neoproductivity19515ptnetThere are two measures of productivity here – short term changes and long term trends. I’ve marked 3 key periods in green to make the point.

Period 1 marks the accession of hardline neolib fiat currency fan Richard Nixon. The long term trend of falling productivity continues, but there’s a spike downwards.

Period 2 is the first term of Reagan, the first US President owned lock stock and barrel by Big Business. He gets elected and there’s a sharp spike down in productivity. And the long-term trend continues.

Period 3 covers the period when the Bushes became a business dynasty, and Uncle Tom Obama sold out to the globalist banking hegemony within 15 seconds of being elected. After a big spike of enthusiasm for a black Democract President, the longest productivity fall in US history follows – and still continues.

Since 2000, as the corporacratic takeover of the States has tightened its grip on liberal democracy’s neck, real (adjusted for inflation) median income has been static or falling. At the dawn of the new century, it stood at was $57k, but by last year, median income was $53k. Blue collar figures are the worst, but the living standards of US labour have been falling at a 0.5% annual rate ever since the turn of the century. It represents the worst 15-year period since records began.

The US business media refer to falling productivity variously as a mystery, a conundrum, a puzzle and a surprise.

The western nation next most in love with neolibollocks is the UK. Over the last thirty years we have seen labour force deregulation, tougher laws against strikes (with another one up Theresa May’s spout) declining trade union power, fewer and fewer employment term contracts, and the rise and rise of zero-hours contracts – better termed Job Seeker’s Ebay in Reverse.

Wages in the UK (especially blue collar) were hit hard by the 2008 liquidity crisis. By 2012, median household income had fallen to 2003 levels in real terms. Today, real wages levels are down 8% on 2009 figures.

Since the banking crisis of 2008 and the austerity mantra adopted by the Coalition soon afterwards, productivity rates in the UK economy have been falling. Today, they’re lower than they were in 2007. The Office for National Statistics (ONS) confirms that British labour productivity fell 0.2% in the last three months of 2014 alone. Q1 2015 shows a further 0.2% drop, such that David Cameron has presided over an economy with the weakest productivity record of any government since the second world war.

The Bank of England has a team fulltime looking at why productivity has fallen, calling it a puzzle. BoE Governor Mark Carney calls it ‘troubling’. The ONS calls it ‘unprecedented’, but offers no explanation. In classically insane Barclay twins style, the Daily Telegraph calls it ‘disgraceful’.

I should therefore like to intervene briefly into this further example of the blindingly Dayglo obvious being ignored by the Expert niche. It’s called falling morale, bitter resentment and reactive depression.

If you show workers zero loyalty, remove their negotiating rights and lower their wages, trust me – higher productivity will not be your reward.

I learned this lesson at my father’s ankles, aged about seven months.

This is The Slog Moral of the Day: You can be an expert with an IQ of 147, but still a blithering idiot.

It is yet more proof that the long-term neoliberal plan isn’t working.

Yesterday at The Slog: Amazing shock discovery that people with less money consume less.


  1. Funny, I thought that Carter won in 1976 and Reagan didn’t get in until 1980 ( after which, according the the chart, productivity enjoyed a bit of a spurt ).


  2. Good one John.
    Sure got something to do with zero hour contracts too.
    I propose we put all Bankers on zero hours contracts.
    Just call one when we want one.
    Should give ’em about 5mins work a week!!


  3. This is the Blade Runner scenario playing out, the story plays out in a futuristic world where there are only two classes, a technocratic wonderkind who control the economy and the technology and a subculture of misfits and bottom dwellers, all the able people have moved to the ‘off world colonies’ for a better life, leaving only giant corporations behind who reign supreme with government being reduced to merely an instrument of corporate policy.

    These changes were in the book/film driven by shifts in technology rendering people obsolete, so pretty prescient stuff, as a teenager watching this for the first time I was struck by the fact that if we are able to reengineer humans to our whim, man has become God and therefore there was no God in the first instance, hence destroying what was left of the indoctrination of going to a Catholic school.


  4. John: Your interpretation of the chart is not quite correct. The second green period was good old Jimmy Carter’s presidency from 1977-81. Remember sky high inflation, recessions, 18 per cent T bill rates, ‘malaise’ and the Iranian hostage mess with the failed rescue that ended in the Middle East sands? That was the period of sharply falling interest rates. Reagan started as POTUS in Jan 1981 and productivity increased at first, then gently declined under Bush41 before roaring upwards under Clinton in the first flush of the internet revolution, where the US had first mover advantage. Under Bush43 and Obama the story is exactly as you portray.

    Median male earnings are now lower than they were 45 years ago: two whole generations with no prospect of reversal on the horizon. Median household income have no been in decline for as long as male earnings because female participation in the work force has climbed sharply and women are relatively better paid than they were earlier, i.e., the gender gap has declined. But the fact is that whilst GDP/ capita has increased since 1970 nearly all the gains have gone to the top 1 per cent if not the 1 per cent of the 1 per cent. Globalisation has worked for the emerging economies but not for the working class in the west for a long time and now it is biting into the middle class and soon will be eating into the upper middle classes. (Much legal, medical and public sector work will probably be offshored without remedial actions to prevent it.)

    The politicians and the honest economists have no effective answers. We are where we are in the two hundred where year cycle with a slow, relentless rebalancing of the global order. The only thing that can affect the speed of this rebalancing is war and that, I’m afraid, is where we are headed.


  5. Correction: The Reagan presidency was the era of sharply declining interest rates ans the Carter inflation got under control, thanks to Paul Volcker. The sentence was transposed somehow after a typing glitch when the screen went blank and some material went into the ether.


  6. John, why do you possibly suppose that the ‘neoliberal plan’, as you call it, was and is ever meant to work. It’s not.

    The average schmuck has trouble tying bootlaces, let alone what productivity, or QE, or inflation and defaltion actually is. I’ve spoken to several friends of my youngest daughter (First class M. Pharm) and they are simply clueless, and I mean completely clueless, of what I’m even talking about, never mind what it means.

    Congratualtions Shirley Williams, you bitch of the highest order, You’ve completely and utterly destryed the ability on two generations to take an interest in anything other than X Factor, Strictly and Britain’s Got Talent

    Liked by 1 person

  7. Clueless people with high end qualifications are nothing new, they are everywhere in the NHS. Compartmentalisation of the high achievers in society is well documented, by virtue of their specialised training which means that they must spend much of their time specialising leaves them blinkered to other ideas. This was true of myself until I retrained and had time to read some politics, philosophy and economics and also landed here reading JW’s daily insights.


  8. Myself Dunc
    I’d rather just give them one zero hour: “This is zero hour Diamond, you have 60 minutes to leave the country.


  9. I liked her mother’s novels, but Shirl was indeed the girl (along with Crossman and Crosland) who realised that if good, free education continued, nobody would be voting Labour by 1990.
    But today, it’s not just broad education that’s disappeared: it’s the ability to think for oneself.


  10. Not really nwf
    Reagan won in 1980, the long-term flatlining continued…..but any dickhead can manage that if he runs up the biggest arms-related jobs stimulation debt in history.
    Remember: Slick Will beat Bush Sr because the economy was (still) getting worse. Clinton actually reduced a lot of Raygun’s debt.


  11. Correct. There’s no intention to make a political point here: Blair followed neolib policies to the letter. My point is, as ever, econo-cultural and constituional: the global gargoyles have hijacked politics, for their own ends, with the muunnneeee.


  12. I would agree, from age 11 we were indoctrinated with one aim only – get 3 good A levels, choose a degree subject – then go and be a Lawyer, Doctor, Engineer or whatever. Not once was anything else spoken of. The underlying social and philosophical roots of the society we were being groomed to serve remained an unspoken mystery.
    Such was the richness of the mixed ability comprehensive school system, a system it seems that was designed to churn out drones for the corporations with just enough expertise to operate the mechanisms of power but never the insight to understand how the mechanism works.


  13. O/T It would seem that we may be up against it as nay sayers with any EU referendum particularly if Dave on a Wave goes early as has recently been suggested. Therefore in the interests of the benefits of cross fertilisation may I suggest your wisdom and journalistic aid is imparted over at EU Referendum which seems to be the only viable campaign for the no side in or out of any political body. Perhaps a referendum piece now and again?


  14. Having known several well educated people I have noticed in them that they are useless with day to day matters,and in particular lack common sense.

    Liked by 1 person

  15. no loyalty, no care or concern for human beings results in them working against you. thank god something makes sense. so productive activity is reducing and will continue to do so until there is change.. good..


  16. Clinton didn’t reduce the true debt as he plundered the social security funds which were “off the books”.
    By the way, Obama didn’t sell out within 15 seconds, he was bought decades earlier.


  17. Desmond it is worse than that,dole cues lining up for work that isn’t there,if they get it,their untrained & make mistakes quality falls losing time & resources & in food factories thief is very high & outages are caused deliberately to try & get a meal from it,knowing that they face foodbanks anyway & management forced to take these workers because it more profitable than running the business properly & losses can offset tax avoidance in other areas,it’s economic madness,locally bentley’s fords BMW’s all being stole,but don’t worry apparently it’s not been reported so crime is falling . & this load of tosh


  18. hi ghost, to me ‘worse than that’ means better than that. the whole thing is a ponzi racket designed to return us all into slavery. you list some of the things that happen in a slave culture. the drivers of this culture need to have the house collapse in on them as any result must be better than what is being offered.. this nightmare called the american dream has come to the bad bit and we all need out. its beyond moderating so we have to wake up…


  19. Short definition of Milton Friedmans Neo-Liberalism, is that a Corporations only loyalty is to its shareholders. Profits are sought by cutting operating costs to the bone. Redundancies ,automation and the favourite, offshoring plant and production to a low wage country.
    The stakeholders are not considered. They are the community built around an industry, the customers, the small businesses and suppliers relying on the local plant.
    We are left with a wasteland of people and youth with no prospects of a decent opportunity to make headway in society or support a family. A slow spiral into poverty and decay (see Detroit)
    The unspoken social contract between Govt. Big business and the citizen is rent asunder.
    The downside is that the home country consumers can no longer afford to buy the imported goods
    ,so the customer base is destroyed .
    Austerity and neo-liberalism combined are a recipe for a slow burning undercurrent of revolution which will eventually burst forth in violence.


  20. The UK’s decline in per capita productivity, is, as John Redwood correctly points out, due to falling production of North Sea oil and financial services, both of which are high value added.Since 1997, the UK has imported 3 .5 million people, most of whom carry out low value added tasks (vegetable picking, car washing,unskilled building jobs, waiters, etc). There are still !.8 million unemployed, not to mention those on disability, and those who claim to be self employed, but who actually earn precious little. So, GDP is back to the level of 2008, but the cake has to support all these extra people and their children. Thankyou Tony Blair.


  21. Most people believe in a fair day’s work for a fair day’s pay. If you’re not getting a fair day’s pay, skiving at every opportunity becomes a the only way to retain any self-respect. People who start their careers near the top of the pile, with guaranteed progress regardless of performance, don’t know this. Bleeding obvious to everybody else.


  22. Another great post John and good in that it identifies that the USA is way worse than us, but we have an interesting 5 years to catch up, or maybe the poor have.


  23. @Salford Lad
    ” A slow spiral into poverty and decay (see Detroit)”
    I worked for ICI for most of my working life in the town where I was born and bred: for Detroit, read Winnington, Northwich, Cheshire…there is no ICI left.


  24. Exactly the same message, but delivered by the finest ex-politician in the world today,
    He started off as a young MASH doctor in Korea, if that rings any bells.
    & click on Dr. Ron Paul warns of huge financial crisis looming
    He’s talking of currency collapse, social turmoil, etc, & blaming politicians & central bankers.

    He came back to politics when tricky Dicky took the US off the gold standard, early 70s.
    He could hear the alarm bells ringing for the fiat currency, right then.
    A good man. He will now have nothing whatever to do with Congress.


  25. JW, falling productivity isn’t just due to morale. Transnational wage arbitrage leads to lower incomes which leads to lower sales which leads to layoffs which leads to lower incomes, ad infinitum. As you have pointed out, it’s a death spiral. Yea and verily, it also leads to piss poor morale. Have you ever wondered why pulling weeds is therapeutic? They are like politicians, choaking the life out of everything good. Setting the little bastards on fire is also fun.


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