Last month, we looked at how America’s aging population and declining workforce reduces the potential growth rate of our economy.
As a result, I wrote: “With fewer workers entering the job market, our businesses will have to rely more heavily on innovation and technology to maintain the same or higher levels of production and sales.”
Since the recession, many businesses have adjusted reasonably well and have managed to maintain the same or greater levels of production or sales with the same or a smaller number of workers.
This trend doesn’t always benefit workers, of course, many of whom work part time or erratic hours, even though they’d prefer to work full time or at least have a more predictable work schedule.
But overall, growth in U.S. “productivity” or efficiency has slowed in recent years; and the financial crisis worsened an already weakening trend. Most other countries around the world are experiencing the same slowdown.
Why is our efficiency slowing, even though we see such incredible strides in new technologies? After all, the widespread adoption of computers, robotics, and other innovations beginning in the 1990s led to improved efficiency in the workplace.
No one has come up with an easy explanation as to why the latest technological innovations haven’t done more to boost America’s (and other countries’) productivity growth. One economist – Robert Gordon – argues essentially that today’s innovations merely tinker around the margins of earlier, transformative inventions. His views are controversial, but he may be on to something.
And while I generally shun the use of personal anecdotes to illustrate broader trends, my own recent experience and that of several friends may help explain why new technologies don’t always translate into improved workplace efficiency.
Like an increasing number of individuals today, I work from home and serve as my own “tech” person. Similarly, many small businesses – which account for the bulk of new job creation – take care of their own technology needs in-house, without the benefit of specialized information technology experts.
I recently bought a new computer to replace a 5-year-old version that had become increasingly slow.
Excited to take advantage of its faster operating system and other features, I set aside time in August to dismantle my old computer and set up my new one. Little did I realize just how long and complicated the process would be.
I’m no “techie,” but I’m not completely incompetent in this area – although I certainly did feel that way after many frustrating hours and days trying to properly install software and transfer certain data from my old computer to my new. The time I spent on this effort was time wasted for more productive uses.
Friends who knew of my frustrations shared similar stories. One downloaded the latest, highly touted version of a popular operating system, only to have part of it crash almost immediately, taking with it her very full calendar and all her contacts. She spent hours on the phone with the firm’s “help” desk to recover vital information.
Another friend called me and laughed sardonically about the fact that her computer had automatically downloaded a “critical” update – leaving her without access to Internet or email. Again, more time spent on the phone with her Internet provider to fix the problem, and time lost for her work.
Magnify our experiences by the many self-employed individuals and small businesses facing the same challenges across multiple devices, and you quickly can count the cost in lost productivity.
Maybe it’s time for software companies to rededicate themselves to making truly user-friendly programs. Why don’t they hire some of the legions of over-50 long-term unemployed individuals to test their new products? Not only might this guarantee that folks like you and me could more easily install and use their products – thereby noticeably improving our productivity – but it might even make a small dent in the hard-to-reemploy ranks.
Add to these problems the mounting toll on businesses large and small from protecting themselves against hacking and cyber theft, and you have the makings of a real drag on economic growth (however much such problems may help cyber security firms’ bottom lines).
If software firms had to bear some of the costs of business and personal losses due to cyber theft and hacking, maybe they would fix known security holes in their programs before putting them on the market.
Slower productivity growth translates into slower potential economic growth. These anecdotes don’t explain fully why more high-tech doesn’t always translate into higher efficiency. But they do suggest there’s a lot of room for improvement.
Joanna Shelton was deputy secretary general of the Organization for Economic Cooperation and Development in Paris; held senior positions in the executive branch and Congress in Washington, D.C.; and teaches at the University of Montana. You can reach her through her website, joannashelton.com.