From Glenn in Brisbane
These charts only make sense in ideologically loaded “economic” or “economist” terms in which less money in, more money out = efficiency. This is an absurd capitalist way of thinking that treats human beings as a means to an end; as worker units; as less then slaves. Efficiency is, in the real material world without the superimposition of idiotic, self-serving capitalist ideology, greater material output for effort; effort being time and personal energy. This applies to service workers also; who invariably sell a material circumstance eg. a cleaned room instead of a messy one. I encourage people to start thinking outside of the box capitalist media and other circumstances have put you in.
Glenn you are right but bear with me while I walk through a few points.
First, using your example, I assume you would agree that a maintenance worker cleaning rooms could improve their productivity by (I) working more or more intensively; or (II) using say a vacuum cleaner rather than a broom. Both methods are taken into account in the productivity measure shown in the chart, that is people working harder and introduction of technology.
Second, I remember walking out of a labor economics class way back being nonplussed by the lecturer’s ongoing reference to “units of labor input” represented by the “x” axis on the supply/demand graph with “capital” represented by the “y” axis. In this analysis, every time a worker tried to get a raise, the chart, as if possessing magical powers, substituted units of “capital” for units of “labor” just disemployed him and put a machine at his work station instead of giving him his raise. So if the worker bees attempted to get themselves a raise, either through union organization, or governmental intervention such as minimum wage or child labor laws, or work safety regulations, the business owner would simply shift the means of production from workers to machinery to maximize efficiency, or productivity. Under this theory, workers cannot win by asserting any control over their wages or work conditions. So,, according to this theory, all the efforts of all the union organization and labor safety regulations over 100 years have been for nought, and have only served to create a privileged caste of union workers that have created chronic unemployment and underemployment for non unionized workers. According to classical economic theory, wage rates could only rise through productivity increases in the overall economy; I.e., a rising tide lifts all boats (or trickle down economics as some prefer.
The problem with the analysis, of course, is the outcome is predetermined by the design of the analysis, which provides for only two outcomes, either labor or machinery. In reality, there are a myriad of outcomes like minimum wage laws, child labor laws, Davis Bacon Act, unionization, etc., or, on the other side, immigrant labor, shipping jobs overseas, etc. So many dynamics come into play.
And then there is one other minor problem with the analysis, which is the old scientific method – hypothesize, test, rehypothesize. As played out, over a very extended period of time, on a highly aggregated basis, the theoretical hypotheses was DISPROVEN; as productivity growth remained consistent, it was the period of time when unions were growing to their peak that wages kept pace with productivity growth; and, with productivity growth continuing, it has been the decline of unions that have resulted in declining wage growth.
So, with the terms of the ideological argument having been set by the free market economists, their own preferred model shows the opposite truth of the one they have espoused all these decades.