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> The Japanese economy is roughly 1/3rd the public sector, 1/3rd low-productivity firms like restaurants or traditional craftsmen, and 1/3rd high-productivity h

> The Japanese economy is roughly 1/3rd the public sector, 1/3rd low-productivity firms like restaurants or traditional craftsmen, and 1/3rd high-productivity household-name megacorps. Why are restaurants and traditional craftsmen considered “low-productivity?” That really strikes me as odd, I have the opposite connotation. I.e. the former being only sustainable as long as they serve a direct demand, while the latter spends most of the time for leviathan’s sake, and is more focused on generating demand (advertising budgets) than solving problems (leviathan can’t be sustained when there are no problems left).

brianwawok 10y ago
Well, the average McDonald's makes something like 40k profit per employee year, and Apple makes something like a million bucks per employee year... So the salary of the two tends to reflect that. (Numbers made up but I bet they Aren't that far off) That is what productivity means here. Not how hard or socially useful the product is. If we all have service jobs, we all would make the same pay. Productivity is why software developer can make good pay.
- user5994461 10y ago
  $1.8M per employee for Apple http://uk.businessinsider.com/top-tech-companies-revenue-per-employee-2015-10 http://uk.businessinsider.com/top-tech-companies-revenue-per...
  - lultimouomo 10y ago
    That's revenue. While Apple is hugely profitable, I'm pretty sure it has great manufacturing costs and per-employee profits are a fraction of that (the first google result says $0.4M).
    - foota 10y ago
      Profit includes employee cost though. It seems those should be excluded.
      - luckydata 10y ago
        Depends if you're calculating gross or net.
- Spooky23 10y ago
  That's a pretty useless comparison between sectors, as you're excluding the manufacturing workforce for Apple, but only partially excluding McDonalds (most workers are franchisee employees).
  - brianwawok 10y ago
    Or look at a waitress in a restaurant. The math will be similar. A service job can't pay you a 6 fig salary outside of a few niche roles. That is why the "it's ok, we can all get service jobs" is a lie. That's a pretty crappy life.
    - woah 10y ago
      Way off topic from the original article but "we can all get service jobs" implies a reality where the cost of any manufactured good and food is approaching 0. In that reality, you would only ever need to spend the money from your service job in other services.
TulliusCicero 10y ago
Well, from a programmer's perspective, a restaurant worker or craftsman has a job that does not scale at all. That's probably what he's referring to.
- deleted 10y ago
  [deleted]
- plaguuuuuu 10y ago
  What do you mean by scale in this case? One restaurant serves 100 customers per night. Ten restaurants serve 1000 customers per night.
  - klodolph 10y ago
    That's exactly the point, restaurants don't scale well. Ten restaurants need almost ten times as many workers as one restaurant. Apple does not need nearly ten times as many workers to sell ten times as many iPhones. If headcount grows linearly with your business size, your business has some issues with scaling that you need to solve.
sandworm101 10y ago
Because they are not suitable for many of the tricks used in high-productivity environments. Traditional craftsmen cannot be automated, else they not be traditional craftsmen. Restaurants cannot enjoy the same economies of scale and still provide the same personalized service out of a tiny shop across from a train station. By another metric, they are low-productivity in that the require many man hours of labor per unit. One can make a carpenter more efficient, but one cannot get away from the need of a person spending hours inside someone's house nailing things together. He;ll never be as productive as an Ikea factory worker churning out flat-pack tables inside a megafactory.
kenferry 10y ago
He's presumably using the economics definition of productivity, not the common English meaning. http://www.investopedia.com/terms/p/productivity.asp http://www.investopedia.com/terms/p/productivity.asp
deleted 10y ago
[deleted]
stuzenz 10y ago
It is a good set of observations. A little steeped in stereotypes and I would be surprised if the numbers are right in regards to breaking the economy into rough 3rds - SMEs make up a large part of the economy - and when I say SMEs - I mean pretty small companies. I enjoyed the way he translated Japanese - it is very stiff and just about British - which goes well with Japanese formal polite language (丁寧語) which is a fair part of the business persona - depending on who you are talking to. Marries reasonably well with some of my observations and complaints I hear from mates who are Japanese salarymen.
aaron695 10y ago
Not sure if it was his point but certainly I noticed most restaurants hand washed rather than use a dishwasher and other inefficiencies. I often wonder if much of the automation that does exist in Japan is more about not dealing with people.
- nihonde 10y ago
  Energy efficiency is a higher priority in Japan when it comes to dishes, laundry, etc. Why pay for electricity when you have a perfectly good pair of hands?

brianwawok 10y ago

Well, the average McDonald's makes something like 40k profit per employee year, and Apple makes something like a million bucks per employee year... So the salary of the two tends to reflect that. (Numbers made up but I bet they Aren't that far off) That is what productivity means here. Not how hard or socially useful the product is. If we all have service jobs, we all would make the same pay. Productivity is why software developer can make good pay.

user5994461 10y ago
$1.8M per employee for Apple http://uk.businessinsider.com/top-tech-companies-revenue-per-employee-2015-10 http://uk.businessinsider.com/top-tech-companies-revenue-per...
- lultimouomo 10y ago
  That's revenue. While Apple is hugely profitable, I'm pretty sure it has great manufacturing costs and per-employee profits are a fraction of that (the first google result says $0.4M).
  - foota 10y ago
    Profit includes employee cost though. It seems those should be excluded.
    - luckydata 10y ago
      Depends if you're calculating gross or net.
Spooky23 10y ago
That's a pretty useless comparison between sectors, as you're excluding the manufacturing workforce for Apple, but only partially excluding McDonalds (most workers are franchisee employees).
- brianwawok 10y ago
  Or look at a waitress in a restaurant. The math will be similar. A service job can't pay you a 6 fig salary outside of a few niche roles. That is why the "it's ok, we can all get service jobs" is a lie. That's a pretty crappy life.
  - woah 10y ago
    Way off topic from the original article but "we can all get service jobs" implies a reality where the cost of any manufactured good and food is approaching 0. In that reality, you would only ever need to spend the money from your service job in other services.

TulliusCicero 10y ago

Well, from a programmer's perspective, a restaurant worker or craftsman has a job that does not scale at all. That's probably what he's referring to.

deleted 10y ago
[deleted]
plaguuuuuu 10y ago
What do you mean by scale in this case? One restaurant serves 100 customers per night. Ten restaurants serve 1000 customers per night.
- klodolph 10y ago
  That's exactly the point, restaurants don't scale well. Ten restaurants need almost ten times as many workers as one restaurant. Apple does not need nearly ten times as many workers to sell ten times as many iPhones. If headcount grows linearly with your business size, your business has some issues with scaling that you need to solve.

sandworm101 10y ago

Because they are not suitable for many of the tricks used in high-productivity environments. Traditional craftsmen cannot be automated, else they not be traditional craftsmen. Restaurants cannot enjoy the same economies of scale and still provide the same personalized service out of a tiny shop across from a train station. By another metric, they are low-productivity in that the require many man hours of labor per unit. One can make a carpenter more efficient, but one cannot get away from the need of a person spending hours inside someone's house nailing things together. He;ll never be as productive as an Ikea factory worker churning out flat-pack tables inside a megafactory.

kenferry 10y ago

He's presumably using the economics definition of productivity, not the common English meaning. http://www.investopedia.com/terms/p/productivity.asp http://www.investopedia.com/terms/p/productivity.asp

deleted 10y ago

[deleted]

stuzenz 10y ago

It is a good set of observations. A little steeped in stereotypes and I would be surprised if the numbers are right in regards to breaking the economy into rough 3rds - SMEs make up a large part of the economy - and when I say SMEs - I mean pretty small companies. I enjoyed the way he translated Japanese - it is very stiff and just about British - which goes well with Japanese formal polite language (丁寧語) which is a fair part of the business persona - depending on who you are talking to. Marries reasonably well with some of my observations and complaints I hear from mates who are Japanese salarymen.

aaron695 10y ago

Not sure if it was his point but certainly I noticed most restaurants hand washed rather than use a dishwasher and other inefficiencies. I often wonder if much of the automation that does exist in Japan is more about not dealing with people.

nihonde 10y ago
Energy efficiency is a higher priority in Japan when it comes to dishes, laundry, etc. Why pay for electricity when you have a perfectly good pair of hands?