Productivity, Productiveness and Personnel

One of my professional institutes, the Chartered Institute of Personnel and Development [CIPD], is holding its annual bash in Harrogate: a sign that the nights are drawing in and Christmas preparations should be made, Among all the stalls promoting clever systems for improving the efficacy of the personnel function and the the productivity of workers there will be the usual mix of 'motivational' and 'experiential' presentations from the stage. Employers will be encouraged to mobilise the funds that are grabbed by the government in the tax called the Apprenticeship Levy, and no doubt that will push along the trend to encourage 15-21 year-olds to undertake pseudo-apprenticeships as provided for in the state's heavy handed allocation of resources. Meanwhile the government remains deaf to requests that the support for vocational programmes that are actually sought for by people over 24 years of age, who have had time to learn on-the-job about work, and assess what they need to know and to understand to move to a better position for themselves and for their employers: a place where their productivity can really improve.

This whole structure of wasteful spending allocations and cuts is deeply depressing, and I have railed about it on many past occasions.

All I want to do in this piece is to reiterate a frequent assertion: that in Millicent Fawcett's brilliant little book Political Economy for Beginners [1870] the point is made, very clearly, that there is a link between productiveness and productivity. Productiveness is the capability of an installation - one work place, or a whole factory, or anything in between - to deliver output. Productiveness is increased by making relevant investment: in machinery, in staff training and development, in the selection of superior input materials etc. Productivity is the measure of the resultant output, stated in the cash return from the sale of the output as compared with the cash expended in wages [of management and of operatives] to achieve the output. It stands to reason that productivity can be increased by offering higher wages: sometimes. Or productivity can be increased by penalising 'slackers', as under some dictatorships: sometimes, for a short time. Or productivity can be increased [or be reported to have been increased, for propaganda purposes] by Stakhanovites: so called after a Russian worker called Stakhanov who was held up as an example by Stalin's publicists because he was alleged to have increased his effort and effectiveness out of sheer enthusiasm for the regime and its targets under the five-year-plan. The whole of the proletariat was urged to emulate him, and thus bring on the socialist paradise much quicker than could otherwise be done; and, of course, eventually the whole thing was exposed as a sham and was quietly shelved.

The most consistent and effective way to raise productivity is by increasing the productiveness of the plant that is provided for the workforce to work with, and by raising their own ability and willingness to use the a resourcesvailable optimally.

It is patently obvious that in many democracies, and especially in Britain, productivity has 'flatlined': it has hardly increased across the whole of industry and commerce, for the past decade; and, if anything, it is declining. This is because - again, over almost the whole economy - serious investment to improve the productiveness of plant and people has simple not taken place. Fake apprenticeships do nothing to relieve this situation: and companies sit on billions of pounds of profits because they do not have enough confidence in the future to apply that cash to new machinery and really deep improvement of their processes and their people.

So: what can be done about that? More next time...