Worker productivity: who profits from it? Not us.

By Richard Mellor

Afscme Local 444, retired

Language is important.  What the capitalist means by freedom is the right of capital to exploit labor.  It means the right of the boss to control the labor process and how work is done.  The end goal of this is profits.

The theoreticians of the 1% measure productivity as how much a worker produces in an hour. From the mid 1990’s to 2003, the French workers were more productive than we are here in the US..  Things changed by 2007 when a UN report found that US workers were now the most productive thanks to our dedication; we spent more time on the job. By 2006, the U.S. worker put in 1,804 hours of work the UN report said, compared with 1,407.1 hours for the Norwegian worker, and 1,564.4 for the French. The US 1% were ecstatic.  Increasing productivity through keeping workers on the job longer is preferable to hiring more workers cutting in to profits and threatening inflation.

The capitalist class, that section of society that buys human labor power as opposed to workers who sell it, is not very happy with present productivity gains averaging around 0.6% over the last four years.

Bloomberg Business Week has a short piece on productivity in its latest edition and explains that figuring out the road productivity will travel is a tricky one. It is important because understanding how it will change will help Federal Reserve Chair Janet Yellen determine interest rates. It’s important to read between the lines when serious journals of the 1% like BusinessWeek report on the state of the economic system they govern.

“Productive workers don’t heat up an economy too fast because they use existing equipment and factories efficiently” BW writes.  Business Week explains that if workers are less productive (producing less in an hour of work than the bosses want to keep profits respectable) employers are forced to “…hire more of them to get the work done”

But getting the “work done” is only part of it. The process of work produces more value than the boss returns to the worker in wages and it is this added value that the boss gets for free that is the sole aim of the owner of capital, their reason for existence. Putting it bluntly, profit has its origin in the unpaid labor of the working class.

Business Week explains that innovation like technology and labor saving devices drive productivity increases as well as “other forces economists can’t readily quantify, such as changes in work practices”.  I have to laugh at the next line, “These murky influences are symptomatic of the ignorance of the economists…..” BW adds.

I don’t think these influences are so murky for working folk. We know too well what “output per worker means,” what the bosses’ mean when they talk about “changing work practices.” The most commonly used term the bosses’ have for increased productivity without hiring is “squeezing”, they must “squeeze” more out of existing employees. For many a clerical worker it means smaller booths, fewer windows, an ergonomic work area that allows the shortest distance between two points so that memo can be typed faster, those other documents finalized quicker.


For a teacher it means 40 children in a class, no classroom assistants, using more of their own money and donating more of their free time in an effort to try and get their kids the help they need.  It is criminal the way teachers are treated in the public education system.  This too, needs to be privatized so profit can be made by those who choose to invest in eduction and we all suffer.

For a production worker it means increased belt speeds. For a nurse it means you’ll never have time to talk to that patient or get to know them as a human being, to give them the human side of care in the way that you would like to. For all workers it means more overtime and weakening of jobsite protections. It means multi-tasking and more output with fewer hands. It means layoffs, unemployment and increased stress and tiredness in the home. It means increased competition between workers and all the tension that entails as we are forced to work faster and harder in order to increase “output per worker” for our individual bosses’. 

Labor saving technology and innovation does not improve the standard of living of the working class as a whole, it drives us deeper in to impoverishment. We do not own the technology, we do not own the innovation, the robots, the machines. The capitalist owns them and their main purpose is to increase profits.

Let’s look at what that UN report I mention above said about wealth produced in comparing US workers to others, wealth produced because we had less leisure time:

“Each U.S. worker produces $63,885 of wealth per year, more than their counterparts in all other countries, the International Labor Organization said in its report. Ireland comes in second at $55,986, ahead of Luxembourg, $55,641; Belgium, $55,235; and France, $54,609.” CBS News Sept. 2007 I will guarantee that the workers in the US, Ireland and these other countries did not earn the equivalent of what they produced.

Whether workers are productive or not bosses will always try to get more as they compete with their rivals for market share.  When their rivals are in Bangladesh or Cambodia the pressure to drive down wages and eliminate conditions that benefit workers (those murky workplace practices) are intense.  As more is “squeezed” out of workers in order to avoid hiring, the workplace becomes ever more oppressive as those of us remaining on the job put our noses to the grindstone in order to keep our slot as the army of unemployed or lower waged waits at the doorstep. From 1973 to 2011, worker productivity grew 80 percent, while median hourly compensation, after inflation, grew by just one-eighth that amount, according to the Economic Policy Institute.

Caterpillar has been making stellar profits. It recently closed it’s plant is London Ontario laying off 450 workers and moved production down to the Muncie Indiana where wages are 50% lower.  Yet in 2012 Caterpillar recorded record profits but still demanded a six-year wage freeze from its workers.

Up until 1975, wages nearly always accounted for more than 50 percent of the nation’s G.D.P. the NYT labor writer Steven Greenhouse points out and that, “From 1973 to 2011, worker productivity grew 80 percent, while median hourly compensation, after inflation, grew by just one-eighth that amount, according to the Economic Policy Institute.”* That’s what productivity means for the boss.

Some writers make the point that this is partially because unions are not strong enough to halt the decline even as companies are making record profits.  It is correct that the declining influence of unions is a major factor.  But this is not due to the lack of power or potential for it. The heads of organized labor shoulder most of the blame, ideologically wedded to the Team Concept, holding the view that profits are sacrosanct and the market the answer to all things, they do whatever they can to help the bosses stay competitive and US capitalism to remain competitive in face of competition from its global rivals.  This all comes at the expense of the worker and our Standard of living.

As workers we must reject this false idea that the market is god and that there is no other way to organize the production of human needs other than under the auspices of market forces and private ownership of society’s dominant productive forces. For workers, freedom can only come if we control the labor process.  We don’t necessarily all draw this conclusion at the same time. We learn through struggle.  But we know what we need. We know what increased productivity feels like as it is written in our flesh and blood.  In the public sector when that lead worker looks at his watch or asks what your doing when for a minute you have to call your partner or wife about an important issue that has arisen or when they cop an attitude because you’re taking your union won morning break it is because that lead worker, even in the public sector, is feeling the pressure of the market and the drive for productivity and profits and is in fear of ending up on the unemployment line.

They always used to threaten us in the public sector that if we weren’t more competitive the company will contract out our work; we were thrown in to competition with our brothers and sisters in the private sector, a recipe that takes us all to the bottom and makes building the solidarity needed for a broad, direct action movement to defend our livelihoods all the more difficult. We are thrown in to competition for the necessities of life along racial, nationalist and color lines, this is why racism and nationalism are so destructive to all workers, even those like many whites here in the US who appear to benefit in the short term and have as coercion and state violence is directed more aggressively at people of color, or men who ignore the plight of women workers.  With US capitalism’s decay, its ability to play the divide and rule card has become more difficult but as workers it is we that must challenge these issues and speak out.

The militarization of the police and the beefing up of this security apparatus that is having such catastrophic consequences for workers and youth of color is part of the drive for profits, it is the 1% preparing to defend its class interests against resistance that the more astute theoreticians of capital know will develop. We will see the BearCats in the suburbs as well in the period ahead; no section of the working class should be left to fight the capitalist offensive alone. The most important immediate task is to build an offensive of our own, to build the structures and movement necessary to drive back this offensive of capital.

*NYT: Our Economic Pickle