A multitude of experts are citing the steps that should be taken to improve our economy.
Almost no one mentions the problem of our lagging productivity. That overarching factor covers many things. Yet it is scarcely listed.
Productivity can be defined by economists as the output per workers per hour; in other words, the efficiency of our economy.
By many measurements we lag behind the United States in our ability to compete, which is limited by our weak productivity. Labour costs in Canada are constrained by the absence of the huge market south of the border, thereby limiting production runs that exist there.
Also, we have permitted wage increases that are out of line. Public workers have obtained wage settlements that are unaffordable in the private sector.
When air traffic controllers attempted to win big wage gains that were unaffordable, US President Ronald Reagan just had them replaced, and that sent a message to all public service workers there, but in Canada no such rough message has been forthcoming.
Hence our firefighters, police and teachers have received wage settlements that in too many cases were outlandish.
Labour costs here should be better controlled by more infrastructure spending so the precedents in the public sector would not spill over to the private part of the economy. If we could increase the volume of goods produced by a more competitive wage structure, our exports, for instance, would be more realistically priced.
Profit sharing schemes can work well to limit malingerers when fellow workers can monitor slack workers. Too, suggestion boxes could lead enterprising workers to develop productivity plans of action, and could entail substantial bonuses to the more innovative workers.
Also, unions should be enlisted to develop more efficient workers. Furthermore, business schools also could develop cost efficient productivity methods.
Pension funds could supply the capital that would increase worker-productivity programs and projects.
Mistakes usually are the result of a lack of planning. Studies show that for every minute of planning, workers save 10 minutes in execution. If we became more productive, the benefits should be enormous.
Still, unfortunately, too few realize that “productivity is key.”