Productivity Up Productivity Output continues to soar, which is definitely a good thing in the long run, but in the near term will serve to keep the labor market soft:
Output, not productivity, increased in May. In fact, the growth in hours worked in manufacturing exceeded the growth in output, meaning that productivity fell a bit. This probably goes hand-in-hand with the recent strong growth in employment:
WASHINGTON: American industry boosted output at a six-year record pace in May, data showed, inspiring confidence that the economy can power ahead even with rising interest rates.
US factories, mines and utilities stepped up production 1.1 percent in May, the fastest rate since 1998, after a 0.8-percent gain in April, the Federal Reserve said.
The increase comfortably outpaced economists’ predictions.
Perhaps surprisingly, Bush isn’t benefiting politically from the recently improved job growth, nor from the
continuing productivity growth. That’s probably fair, as the country still has about 1.3 million less jobs than it did when Bush took office. And massive deficits too. And we blew a few hundred billion, and counting, invading Iraq. And spent $540 billion on a Medicare drug plan seniors don’t like. So I guess it’s not really all that surprising that Bush’s ratings on the economy remain low.
P.S. Thanks to commenters for quickly correcting this. Perhaps I should have a bit more sympathy for Jonathan Weisman. Oh wait. I admitted and corrected my mistake, unlike Weisman. I remain unsympathetic.