Productivity has been declining for nearly a year, and experts are warning that it’s a major threat to the economy. Despite a booming job market and consumers who seem to be spending with abandon, companies are not getting enough output from their workers. This lack of productivity is creating a slowdown that’s hard to detect in real time.
Productivity is critical for the economy because it helps determine the standard of living for a population. It’s not just about making workers try harder, but also about using technology and training to improve workflows and efficiency. Unfortunately, productivity has dropped in recent years due to factors such as quiet quitting among employees, remote work, and labor hoarding by employers.
However, there is hope on the horizon. AI tools are showing promise in boosting productivity. A recent study found that workers who were given AI tools were up to 30% more productive, especially the least experienced workers. Experts predict that the rise of AI could help usher in a new Roaring 20s and even drive profit growth, keeping the stock market on track.
Despite these positive predictions, the decline in productivity is still a cause for concern. It’s unclear what can be done to turn things around, but it’s clear that something needs to be done soon to avoid a deeper economic downturn.
