Syracuse (WSYR-TV) - During a recession, the common thinking is that big companies suffer huge losses – causing them to produce less. But that wasn’t the case in this recession.
A strange thing happened in this recession because instead of dropping during the recession, it actually rose for the first time – and at a very good clip.
If we take a look back at productivity from 2000 until 2008, the average US companies increased their productivity by 2.5%. That doesn’t seem like a lot, but it is better than most developed countries out there.
But after a first quarter positive rise in productivity, the second quarter of this year saw a 6.6% increase in the middle of the recession. This is good on a couple fronts. It means that American companies are more productive and they can compete better with others around the world. It also justifies higher stock prices and better earnings.
The bad news means they can produce more with fewer workers. Therefore, I think this means we’re looking at a slow recovery on the employment end.
