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Ah I think I know where we are crossing wires. I'm wondering if they have hidden the hours worked offshore. So it it looks like productivity per hour is up but
by xupybd 5y ago
Ah I think I know where we are crossing wires.
I'm wondering if they have hidden the hours worked offshore. So it it looks like productivity per hour is up but actually it's happening off the books of US companies.
So in the example. The US plant has US workers that input say 20 hours to make 1000 parts. But buys in a component made in China and that component has 1000 hours per 1000 output parts. The US company sees that component as a material cost not a labor cost so doesn't count that as labor going into the end product.
I hope I'm making sense?
- dangus 5y agoI see what you mean. In this theory it's almost like US labor faces a survivorship bias. In your hypothetical example, a US company wouldn't really keep a factory open in the US that produces 1000 outputs per 1000 hours. They'd rather purchase the good as an input material from an overseas factory. e.g., Apple's iPhones aren't produced at all by Apple employees. Another topic we never really reached in this discussion is how worker productivity is affected by capital investment: Is a McDonald's worker more productive than they were in 1980 because of their own abilities and skills improving, or is it due to computerized and automated assistant devices like automatic drink pouring machines and sophisticated point of sale software?