Productivity Up 2.2% in 1994; Analysts Split on Meaning
The productivity of American workersÛÓthe measure of the amount of goods and services produced for every hour workedÛÓincreased by 2.2 percent last year, the Labor Department reported yesterday.</br></br>It was the fourth year running that the governmentÛªs productivity measure was significantly above the dismal 1 percent annual gains that characterized the American economy of the 1970s and 1980s. And because economists consider productivity the key variable in determining a nationÛªs wealth, its trends are closely watched.</br></br>But analysts were divided yesterday, as they have been for nearly two years, on whether the good productivity numbers suggest a new, higher plateau for the economy, or merely a natural catch-up that goes on during an economic recovery, particularly one as strong as this one.</br></br>"In a year in which the economy grew 5 percent, 2.2 percent productivity growth is no great shakes,Û said Daniel Sichel, an economist at the Brookings Institution who is one of the pessimists. Sichel said nothing heÛªs seen so far is inconsistent with a long-term trend of 1 percent increases in productivity.</br></br>economist at Lehman Brothers Inc., the New York investment bank, who credited better management and an increase in spending on computers and other equipment with a longterm boost in the productivity of workers and the competitiveness of their firms.