Labor and Productivity

By Andrew Paparozzi
In January 20, 2009

Needless to say, companies are cutting jobs. Just take a look at the latest employment data from the Bureau of Labor Statistics (BLS). The nation’s overall unemployment rate ended 2008 at 7.2%, a 16-year high. Printers are no exception. Total employment in printing and related support activities fell 3.7% in 2008 to almost 601 thousand—its steepest drop since a similar decline in 2003. Available data show that total
employment in the commercial printing industry was down 3.3% for the first 11 months of 2008, averaging almost 462 thousand for the period. Furthermore, job losses in commercial print are intensifying, with November 2008 employment down 6.5% from the previous year.

Unfortunately, some of the job reduction represents companies going out of business. But it also represents companies cutting jobs and overall labor input. Unlike the previous 2 years, as commercial printers react to the drop in activity, much of the decline in 2008 has been among production workers. In addition to lower employment, the drop in activity also has led to a reduction in overtime and a shorter average workweek. A combination of fewer workers and less hours resulted in a 7.6% decline in total production hours for November 2008 compared to the previous year.

Such a steep decline in labor input can imply some welcome gains in productivity. But while conditions are extremely challenging, we still must proceed with caution. There’s more to productivity than just the number of hours worked. Potential productivity gains picked up from operating with fewer employees and reduced hours can easily be lost to workflow disruptions.

Andrew Paparozzi                 Joseph Vincenzino                        Kong
Lue Wang

Andrew Paparozzi

Epicomm's Andrew Paparozzi, Vice President/Chief Economist, is well-known for his accurate and thoughtful discussions on the economy and US commercial printing industry. A foremost author and speaker on economic business trends in the printing industry, Paparozzi heads Epicomm's Printing Economic Research Center.

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