THE U.S. PRODUCTIVITY GROWTH RECESSION: HISTORY AND PROSPECTS FOR THE FUTURE

Study is given to the aggregate labor productivity growth in the U.S. Real gross national product per labor hour is the indicator of labor productivity, and peak periods of economic activity were chosen to minimize business cycle distortions of productivity movements. Productivity has slowed considerably, and this trend can be traced to a very slow growth in the capital/labor ratio in the years of 1970-75 and to a change in the labor force mix due to large numbers of young and inexperienced workers coming into the labor force. The labor force mix factor will only temporarily have this depressing effect, since as the young gain experience, the productivity growth rate should increase. Other temporary factors worked to reduce productivity increases: 1. energy prices, 2. energy-intensive technologies, 3. environmental regulations, and 4. the imposition of wage and price controls in the early 1970s.