U.S. surges ahead in labor productivity
By JOHN ZAROCOSTAS
GENEVA, Switzerland, Nov. 14 (UPI) -- Boosted by new technology advances, labor productivity in the United States between 1995 and 2000 increased by an average 2.6 percent, up from 0.8 percent between 1990-1995, and outpaced the European Union and Japan, according to a report by the International labor Organization.
But these steady gains, warns the ILO, could be derailed or reversed in the short term by the shock of the Sept. 11 events.
"We're expecting a dip in productivity," Jeff Johnson, head of the team of ILO economists who compiled the study, told United Press International.
Labor productivity,considered a key indicator of economic performance,is influenced by factors such as the accumulation of machinery and equipment, improvements in organization and transportation, workers skills, or human capital, and new technology.
Johnson said that as the Sept. 11 terrorist attacks, and the resulting economic slowdown, "is new for everyone," its difficult to predict the extent of any decline in productivity growth rates, in areas severely impacted such as aviation, travel, tourism and financial services.
The 887-page report, "Key Indicators of the Labor market 2001-2002," concludes that as the affected industries are global "the impact of a downturn in any major market is likely to be felt worldwide."
Nevertheless, aside of the short term shocks, the ILO report says it sees "no reason why the global economy cannot absorb them and sustain productivity growth rates consistent with the trend prior to Sept. 11."
In the European Union, the growth rate in labor productivity, defined as output per unit of labor input, between 1995-2000 slowed to an average of 1.2 percent, down from 2.4 percent in the first half of the decade.
Japan also posted a slower growth rate of less than 1 percent between 1995 and 2000, it said.
U.S. Treasury Secretary Paul O'Neil has attributed some of the extraordinary pickup in productivity growth between 1995 and 2000 "due to the expanding role of information and communications technology in the economy."
The ILO report also views as temporary, and unrelated to Sept. 11, the decline in the "new economy" and predicts a new generation of information and communications technology linked economic growth to follow the current downturn.
With regards to other regions, the ILO study highlights labor productivity levels in most Latin American economies have shown little improvements over the past two decades.
"In 1999, the gap in output per person employed between Latin America and the United States was 69 percentage points compared to 59 points in 1980," it said.
However, the report says labor productivity levels for emerging Asian economies have shown a better catch-up performance.
In the last two decades, says the ILO, the emerging Asian economies have posted average productivity growth rates that were "about 2.4 percentage points faster than for the advanced industrial economies and the productivity gap relative to the U.S. improved by more than 5 percentage points."
Value added per person employed in the United States (measured in 1990 U.S. dollars)in 2000 averaged $54,879, up from $48,517 in 1995, the report said.
Similarly, last year value added per person in Italy, $42,986; Germany, $41,859; United Kingdom, $41,054; Japan, $39,768; Korea, $33,855; Poland, $19,016; and Mexico, $18,492.
Moreover, based on the latest data available, value added per person employed in 1998 in China averaged $6,045 and in Taiwan, $37,529.
For other emerging Asian economies, such as Malaysia, value added in 1999 averaged $20,549; Indonesia, $7,299; and India, $4,943.
In 1999 value added per person employed in Argentina averaged $24,252; Brazil, $13,894; and in Chile, $27,765, the ILO said.
Finally, the report notes that employment opportunities in advanced industrial countries in the services sector continue to outpace those in manufacturing and the agricultural sector.
In 2000, the percentage of employment in the United States in the services sector in stood at 74.5 percent; for Canada, 74.1 percent; France, 74 percent; United Kingdom, 72.8 percent; and Japan, 63.1 percent.
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Copyright 2001 by United Press International.
By JOHN ZAROCOSTAS
GENEVA, Switzerland, Nov. 14 (UPI) -- Boosted by new technology advances, labor productivity in the United States between 1995 and 2000 increased by an average 2.6 percent, up from 0.8 percent between 1990-1995, and outpaced the European Union and Japan, according to a report by the International labor Organization.
But these steady gains, warns the ILO, could be derailed or reversed in the short term by the shock of the Sept. 11 events.
"We're expecting a dip in productivity," Jeff Johnson, head of the team of ILO economists who compiled the study, told United Press International.
Labor productivity,considered a key indicator of economic performance,is influenced by factors such as the accumulation of machinery and equipment, improvements in organization and transportation, workers skills, or human capital, and new technology.
Johnson said that as the Sept. 11 terrorist attacks, and the resulting economic slowdown, "is new for everyone," its difficult to predict the extent of any decline in productivity growth rates, in areas severely impacted such as aviation, travel, tourism and financial services.
The 887-page report, "Key Indicators of the Labor market 2001-2002," concludes that as the affected industries are global "the impact of a downturn in any major market is likely to be felt worldwide."
Nevertheless, aside of the short term shocks, the ILO report says it sees "no reason why the global economy cannot absorb them and sustain productivity growth rates consistent with the trend prior to Sept. 11."
In the European Union, the growth rate in labor productivity, defined as output per unit of labor input, between 1995-2000 slowed to an average of 1.2 percent, down from 2.4 percent in the first half of the decade.
Japan also posted a slower growth rate of less than 1 percent between 1995 and 2000, it said.
U.S. Treasury Secretary Paul O'Neil has attributed some of the extraordinary pickup in productivity growth between 1995 and 2000 "due to the expanding role of information and communications technology in the economy."
The ILO report also views as temporary, and unrelated to Sept. 11, the decline in the "new economy" and predicts a new generation of information and communications technology linked economic growth to follow the current downturn.
With regards to other regions, the ILO study highlights labor productivity levels in most Latin American economies have shown little improvements over the past two decades.
"In 1999, the gap in output per person employed between Latin America and the United States was 69 percentage points compared to 59 points in 1980," it said.
However, the report says labor productivity levels for emerging Asian economies have shown a better catch-up performance.
In the last two decades, says the ILO, the emerging Asian economies have posted average productivity growth rates that were "about 2.4 percentage points faster than for the advanced industrial economies and the productivity gap relative to the U.S. improved by more than 5 percentage points."
Value added per person employed in the United States (measured in 1990 U.S. dollars)in 2000 averaged $54,879, up from $48,517 in 1995, the report said.
Similarly, last year value added per person in Italy, $42,986; Germany, $41,859; United Kingdom, $41,054; Japan, $39,768; Korea, $33,855; Poland, $19,016; and Mexico, $18,492.
Moreover, based on the latest data available, value added per person employed in 1998 in China averaged $6,045 and in Taiwan, $37,529.
For other emerging Asian economies, such as Malaysia, value added in 1999 averaged $20,549; Indonesia, $7,299; and India, $4,943.
In 1999 value added per person employed in Argentina averaged $24,252; Brazil, $13,894; and in Chile, $27,765, the ILO said.
Finally, the report notes that employment opportunities in advanced industrial countries in the services sector continue to outpace those in manufacturing and the agricultural sector.
In 2000, the percentage of employment in the United States in the services sector in stood at 74.5 percent; for Canada, 74.1 percent; France, 74 percent; United Kingdom, 72.8 percent; and Japan, 63.1 percent.
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Copyright 2001 by United Press International.