We Might Escape the Dreaded Double Dip Yet, Productivity Rises

blr-editor | October 13, 2011 | Comments (0)

All 19 developed countries had productivity growth in 2010

As dire predictions of a double dip increase in number and volume, there remain some signs that we may escape the dreaded ‘double dip’ recession yet.

Actually, technically we cannot have a double dip recession, as more than two quarters have passed since the end of the last recession.

The latest sign of that light at “the end of the tunnel” not being an onrushing train is Europe’s frantic efforts to shore up their EFSF or European Financial Stability Fund, which was ratified in the final country – Slovakia, yesterday.

However the U.S. Bureau of Labor Statistics reported today that productivity growth in manufacturing increased in 2010 in all 19 major developed countries surveyed. The list includes the U.S., Canada, Australia, Japan, and several EU countries.

In the majority of these countries, labor productivity (output per hour) rose by more than 5%. In the previous year, productivity fell in 12 of 19 countries.

Increases in productivity in 2010 were driven by large gains in output coupled with modest changes in hours. Output, after having fallen in all countries in 2009, rose in all countries in 2010.