PRODUCTIVITY-KEY TO PROGRESS

...WE LIVE at a higher living standard ;today than the world has ever known in terms of available goods and services...

...The truth is that resistance to technological changes has made housing a primitive, handicraft industry in a mechanized, power-driven world...

...New and better machinery is the critical factor in increasing productivity...

...in 1850, only about 12 per cent of our energy supply was harnessed to work performance...

...One could almost concentrate the whole history of economic development into this simple transition: man power to animal power to machine power...

...Both unions and management ha#e a job to do in getting across to workers the necessity of raising output per manhour...

...And real income has steadily risen with productivity...

...The steep rise in the amount of output per worker during the past century has been closely tied to a parallel increase in capital facilities per worker...

...None of these factors explains our remarkable progress, beeause none of them is unique to us...

...Nevertheless, it is easy to understand why there is often resistance to the introduction of labor - saving machinery...

...The end result is a wasteful, inefficient, high-cost industry with terrible ups and downs...

...The key to increased productivity is new and more efficient machinery...

...We've learned how to regulate credit and the security markets, how to use public works and taxation to moderate cyclical fluctuations...

...Today, he produces about $1.40 worth in dollars of the same purchasing power...

...More and better tools rather than harder physical work have been the key to greater productivity...

...The shift to machine power changed America from a rural agricultural nation to an industrial giant...

...Together with water power, they perform 94 per cent of mir wi-i'i' ••« u...

...BUT WE ARE certainly not satisfied with our living standards as they are, because many Americans are still below what we consider a reasonable minimum, although their number constantly grows smaller...

...higher living standards...

...This is the essence of the American economic system: the multiplication of human energy with machinery using mineral energy...

...All this is to imply, not that the defects of our American economy cannot be ameliorated because our knowledge is inadequate, but that r>n ever can or will be perfect, including this one...

...The work output we derived from mineral fuels was a staggering five hundred times greater in 1944 than in 1850...

...It is not merely statistics that we lack, but a scientific grasp of social-personal-economic interrelationships...

...In less than a century our net output of goods and services has increased over twentynine times...

...In 1850, the average American worked seventy hours a week...

...This can best lie achieved, not by speed ups and the usual ineffective incentive systems, but by the most efficient use of machinery and the worker's skill, ft requires teamwork...

...Last year the Consolidated Kdison System in New York turned out about as much energy as the total work output of the entire nation in IU50...

...We shall never do away with business fluctuations altogether, but Hie violent "boom und bust" pattern must be avoided if we are to have steadily increasing productivity combined with a high rate of total production...

...today...

...It depends on how wisely we weigh economic and political policy —-government, union or business—in the light of their effects on productivity, so that we do not unknowingly undermine the very basis of economic welfare...

...Fred Dewhursi in editing the monumental economic study, "America's Needs and Resources...

...WE MUST SOMEHOW LEARN to prevent the excesses of booms that lead to collapse...

...Productivity is not, of course, the only key to higher income -and greater security...

...They think of productivity as the to'!d volume of production instead of seeing it as the average amount a man produces in a given time...

...Some promising joint labor-manag' - nient experiments are being tried with group incentives to increase productivity...

...If capital, workers and businessmen had failed to go into new industries and to create new ways of doing things, we would still be living in log cabins and driving one-horse shays...

...THE FIRST TWO OBSTACLES to increased productivity were resistance to technological improvements and labor-management strife...

...Where good relations exist between workers and management, new, ways of increasing productivity can also be worked out...

...Today, he works forty-three...

...Long reports were written about it and sel •ious estimates of the "tech nologieally unemployed" were oaleulated...

...We are constantly building up an arsenal of weapons to combat the violent fluctuations of business cycles...

...We have devised wonderfully ingenious applications to harness coal, gas, oil and water power to multiply human labor...

...It depends to a great extent, as it always has, on the combined wisdom and action of individual Americans—on the way we vote, the way we work, the way we buy and sell and manage...

...One obstacle is fear of the goose that lays the golden egg...

...The housing industry is shot through with such rules...

...The perfectibility of the economic system is often assumed, rattier immodestly in view of our severely limited knowledge of economic cause and effect and of our even more limited knowledge of the relationship of economic phenomena to psychological and social factors...

...The main thing to remember is that the increase in productivity is not inevitable...

...If ever-increasing productivity has taken us this far on the road to economic well-being, why not farther...

...And yet willingness to risk capital in new plants, new types of equipment and machinery is essential to technological gains...

...People are afraid to risk their savings in new ventures...

...Many people dismiss our achievements somewhat casually and inaccurately as the results of "richness in natural resources," "democracy," "free enterprise" or just plain "knowbow...

...We use nearly twentynine times as much "work-energy" today as we did a century ago...

...There are, unfortunately, a number of obstacles...

...A book by Miss Waldron on Information Films will be published by the Columbia University Press this summer...

...True, the initial cost of such machinery is heavy, but in the long run it does our work for us more cheaply than human beings and animals alone ever could...

...The idea of a persistent or cumulative technological unemployment is absurd...

...Productivity makes real strides only in dynamic, expanding economy where investors are willing to risk thencapital o'n new discoveries and inventions...

...Increased productivity has not only given us a vast increase in the amount and kinds of goods, but we've had a steady expansion in the percentage of the population that works...

...WORKERS HAVE A RIGHT to be protected against individual economic injury, but they injure themselves and society when they fight against technological improvements...

...Worse yet, in arguments between planners and non-planners both tend to overlook or take for granted the main source of economic welfare-—high productivity...

...and to underline the wisdom of taking a good long look at what makes this economy work as well as it does before we, individually or collectively, commit ourselves to any fundamental revisions...

...Management is apt to see clearly that higher productivity spells lower costs and more customers, as well as greater profits, Workers do not always see that it also spells higher wages and more and cheaper goods for everyone...

...With the exception of a few costly and painful depressions, we've had our "cake" in the form of expanding full employment and "eaten" it in the form of greater leisure an...

...Industrial conflict also stands in the way of raising productivity...

...In 1950, our average American produced about 27 acnts worth of goods an hour...

...But advancing productivity, based on machine power, has done more than anything else toward * raising wages and the standard of living...

...A third factor is monopoly restrictionism...

...The unpredictable business cycle may provide a fatal obstacle to significant gains in productivity...

...The contribution of coal, petroleum and natural gas to our "workenergy" supply increased from less than 5 per cent of the total to more than 87 per cent...

...while men <if „»;•• nt for a meager 6 per cent as compared with over 50 per cent in 1850...

...It is often incorrectly thought of as "labor efficiency," but actually this is only one small factor...

...2) small or large doses of regulation by government can remove the alleged defects...

...As a matter of fact, our national income has increased by almost the same amount as our total work-energy output, about twenty-nine times...

...Perhaps the greatest obstacles to increased productivity are ones we cannot control at all or which wo understand only dimly—another war or a worldwide depression would set us back a long way...

...Most workers can own good automobiles, but they cannot afford to buy a good house...

...The uniquely responsible factor is high productivity based on constantly increasing) use o/ poteer—the most lavish use of energy the world has ever seen...

...In the 1930's it was popular to talk about about "technological unemployment...

...These are what planner and non-planner, capitalist and socialist have to face if they want to be realistic...

...Unions sometimes make rules against their use—for example painters resist the use of spray guns...

...In a monopoly situation, prices can In- high without fear of competition...

...Over the long haul, howevei, it is only through such displacement that material progress is possible, If all the men operating canal boats, livery stables and blacksmith shops m 1830 had stayed in business, and thensons had followed them, railroads would still be a luxury for the feu and the automobile a plaything of the rich...

...Over the long pull, no other country has done as well...

...We have a huge reservoir of socialsecurity funds to guard against a dryingup of buying power...

...Such machinery may mean disaster to the person who is displaced...

...Depression puts a halt to the building of new plants, machines and equipment...

...THIS GREAT DRAMATIC SHIFT to mineral energy is the very basis of technological progress...

...Contrast the housing Industry with the auto industry where every mechanical device is used to the fullest to turn out better, cheaper cars...

...The housing industry is a notorious example of resist anee to new techniques, of feathei bedding and other devices to "protect the worker's job," and of monopoly practices to "prevent cut-throat com petition...

...It also made men's lives easier and richer...

...There is no urgent pressure to keep costs down...

...Monopolies very often deliberately keep production low so us to raise demand enough to maintain a high price level Instead of small per-unit profits on large quantities of goods, they may aim at high profits on a small volume of production...

...This is what made it possible to increase the net output of goods and services twenty-nine times from 1850 to 1944, even though working hours were much shorter and the population only six times greafW, And this quintupled productivity in turn rested largely on the fact that Americans as a group had at their disposal all the marvelous advantages of mineral eliergy, five hundred times as much as in 1850 when men, animals, water, wood and wind furnished most of the energy...

...With less than one fifteenth of the world's population and one-seventh of its land area and resources, we produce and consume one-third of all the world's goods and services...

...These ipvolve the payment of bonuses or profit sharing for everyone |n the factory when the average output per hour increases...

...But many workers fear that machines will take their jobs...

...In other words, on the average a man ran produce about rive times as much in an hour today as he did in 1850, His productivity has increased over five times...

...And, to make it more striking, we've bad a shorter and shorter work-week...

...Today, a third or more is used for work...

...PLANNERS BASE most of their economic theories on these generalizations: (1) American capitalism has defects: e. g., cyclical instability, tendency to monopoly, unequal distribution of wealth...

...ALTHOUGH INCREASING productivity underlies all our economic progress, most people do not readily grasp the concept...

...Wise social security legislation, wise- business practices, and strong, intelligent unions are important too, especially as they affect distribution of the gains of productivity...

...Not only do men suffer bitterly in bad times, but private investment almost comes to a standstill...

...Too many Americans think that this happened automatically that the age of steam and electricity, of modern transportation and mass proi duction, was simply the inescapable result of Watt's development of the steam engine...