Productivity is way up
The Secret Weapon Behind America's Soaring Productivity
Americans are getting more efficient on the job, and it's not because of AI. That's great news for the US economy and the stock market's future.
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The Lede
A new gospel is coming out of Silicon Valley, major business conferences, and seemingly every corporate call with investors: Artificial intelligence is about to make workers way more productive. In fact, the argument goes, the data shows that labor productivity — the wonkish measure of how much a worker can get done in a given hour — is already on the rise.
Key Details
- At the simplest level, labor productivity is how much output (widgets, meals, spreadsheet computation) one person can complete in an hour.
- Over time, labor productivity has been driven by different elements. In the 1990s and 2000s, rising productivity was mostly from capital deepening and new innovations.
- Conditions so far in 2024 are much improved — recession risks have receded, and corporate confidence has recovered. A steadying of the labor market is also a strong sign of a coming productivity boom.