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Why worker productivity has fallen in the U.S.

Transcript

Productivity is probably the most important economic indicator for the health of an economy, and in the U.S. it's falling. (Story aired on All Things Considered on Oct. 5, 2022.)

BUSINESS

Why worker productivity has fallen in the U.S.

LEILA FADEL, HOST:

The relationship between workers and employers has been the subject of much debate. Now it's starting to show up in productivity data. NPR's Stacey Vanek Smith on what it means for the health of the economy.

STACEY VANEK SMITH, BYLINE: Brian Bowser (ph) is 22. He just graduated from the University of Louisville, but he has been working for years, most recently at a rental car company.

BRIAN BOWSER: I really liked that it paid pretty well when I was making, like, $25 an hour.

VANEK SMITH: Brian started at the agency last year, and he needed the work. He'd been laid off from a previous job at the start of the pandemic, and he had bills and tuition. Brian worked hard, got along with everybody. But one day in the middle of art history, he got this text from his boss.

BOWSER: And they're like, hey, the pay is going down to, I think it was like 13.50 an hour.

VANEK SMITH: Brian's pay was basically getting cut in half. He immediately started texting his co-workers. They'd all gotten the same note.

BOWSER: What the heck, you know? Two minutes ago, I had a nice, secure job, and everything was all right.

VANEK SMITH: There was no explanation. And this was at a moment when companies were all desperate for workers and raising wages everywhere. Brian was shocked, but also not that shocked. Brian's short time in the workforce had taught him that this is just how it goes with companies.

JULIA POLLAK: The connection between effort and reward got broken during the pandemic.

VANEK SMITH: Julia Pollak is a labor economist at ZipRecruiter. She points out that at the start of the pandemic, companies laid off nearly 20 million people in a matter of weeks.

POLLAK: Many people have responded to that experience by saying, I'm never going to care as much about a job again because they don't care about me, and they'll just drop me if the economic winds change.

VANEK SMITH: Yeah. Companies will just work you till you drop and then drop you when they want. Working your heart out for them is a fool's game. Pollak thinks these kinds of ideas have created a sort of economic ennui among workers, an ennui that is starting to show up in the numbers. Not that economists are measuring ennui, but they are measuring something called productivity. Productivity essentially measures how much stuff companies produce for each hour we work. And this year, that number has seen the biggest drop on record.

(SOUNDBITE OF TIKTOK VIDEO)

AARON KNIGHTLEY: Be the last one in and the first one out and do as little as you can for maximum pay.

VANEK SMITH: This is a TikTok from business and finance blogger Aaron Knightley. It has been watched by 17 million people.

(SOUNDBITE OF TIKTOK VIDEO)

KNIGHTLEY: So the fact is, no matter how much people say, but I'm really passionate, and I love my job, believe me, the CEO is not bothered by you. You are a number.

VANEK SMITH: Economist Julia Pollak says a lot of things are probably contributing to the drop in productivity. But she thinks burnout, frustration and ennui are part of it. And if this drop continues, the consequences could be bad. Productivity is the fuel of our economy. If it declines, the economy shrinks. Quality of life goes down. Opportunities dry up. Innovation and ideas go elsewhere. It is a bad cycle. And, Pollak says, ennui is a hard thing to turn around.

POLLAK: Once you've had that sort of Ecclesiastes moment of thinking that everything's futile and pointless...

VANEK SMITH: She just went biblical.

Ecclesiastes is the book in the Old Testament that begins, meaningless, meaningless; everything is meaningless.

That is not what you want the guy who's, like, administering your medication to feel (laughter).

POLLAK: Exactly.

VANEK SMITH: But Brian Bowser, as he was reflecting on all the time and energy he'd put in at the rental agency - driving cars to the car wash, bringing them back, renting them out - says it did feel meaningless.

BOWSER: The job was, basically, drive for six hours a day in a circle. And at the end of it, you just got nowhere.

VANEK SMITH: To Brian, it felt like a metaphor for the workplace. So Brian opted out. He got his real estate license and is going to work for himself.

Stacey Vanek Smith, NPR News.