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*Productivity: A Miracle in the Making

Greenspan believes that technology has allowed firms to get more from less

“Every one is subscribing productivity to the technology boom. But I think productivity will die when the job recovery picks up,” said James Paulsen, chief investment strategist at Wells Capital Management.

Productivity growth ambled along at a 1.4 per cent rate from 1972 to 1995, than raced ahead in the late1990s.

The high productivity of the past two years, Greenspan explained last month, is keeping US business from hiring more workers. Job growth will pick up, Greenspan and others say, when productivity eases.

One hole in the productivity growth story, is that the government’s method of determining productivity is not accurate.

Inflation was largely kept in check during the 1990s because the rolling nature of recessions around the globe over the course of the decade.

“When you under-staff, people jump on the loose ball. You find out who the real performers are. Not so when you’re overstaffed,” Bill Gates said.

(Source: Gulf News)