Yesterday’s productivity report for 2014q1 was predictably negative—we already knew that real GDP fell in the quarter while employment grew apace—but I don’t read much into the noisy quarterly changes.
But then there’s this: year-over-year, productivity growth was up 1% last year and has averaged 0.8% since 2011. The figure below plots the yearly changes, which are themselves pretty noisy. What’s more instructive is the smooth trend through the numbers.
The trend suggests that the pace of productivity growth has decelerated since the first half of the 2000s and this begs an important question. There’s considerable speculation that the pace at which machines are displacing workers has accelerated. I keep hearing about “the end of work” based on the assumption that the pace of labor-saving technology—robots, AI—has accelerated.
