What is Productivity?
- Productivity is measured by how much can be produced per hour or worker.
- Time is the most important factor for productivity.
- Technological innovations are the most typical way of increasing productivity.
- Productivity can also be increased through improved organization, as even seemingly simple changes can have big impacts.
Example
- an auto-shop in Sweden, there were 2 shifts of 8 hours with roughly an hour of breaks. The shifts were increased to 3 shifts of 6 hours, with less breaks.
- This increased productivity and motivation for the workers as they had more free time.
Increasing Productivity
- Rises in productivity can be seen by the amount produced in a certain amount of time.
- Even if total working hours have decreased, the amount produced has increased in recent years.
- Industrialization and technological advancements have lead to manual labor to be replaced by machines/automation.
- Free market economy encourages competition, forcing increases in productivity.
- Generally people who are the most efficient make the most profit, forcing others to catch up.
- Without a rise in productivity you will get left behind.
- Knowledge has increased and people are able to create and utilize new ways of doing things.