It is no secret that U.S. labor productivity accelerated in the second half of t

Question

It is no secret that U.S. labor productivity accelerated in the second half of the 1990s. The bulk of the spurt can be traced to the boom in investment information technology capital and to the growth in the information technology-producing part of the economy. Measurement issues abound and having better data would help resolve them. Whether or not the change in productivity is cyclical or structural is too soon to tell. Do you think that US economy will experience higher labor productivity soon? Briefly discuss.

Explanation / Answer

It already is, The economy is employing less labor to produce the same GDP that it did a year or two ago. THat's what happens during/after any recession. You wash out the least productive elements and get more productivity out of what's left.

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