It\’s long been noted that French labour productivity is higher than that in the US. For example, Paul Krugman from 2005:
First things first: given all the bad-mouthing the French receive, you may be surprised that I describe their society as \”productive.\” Yet according to the Organization for Economic Cooperation and Development, productivity in France – G.D.P. per hour worked – is actually a bit higher than in the United States.
And this number is true: among those who have a job productivity is higher in France per hour than it is in the US.
The normal explanation given for this (that is, the explanation where people don\’t immediately swoon over how much better a Statist, social democratic, high welfare cost place like France must therefore be) is that in France the very low (or even no) productivity workers don\’t get a job at all, while in the US they do.
Certainly, historically, it\’s been true that the unemployment rates diverge notably: and very largely because of the differences in the long term unemployment rates.
But we are able to bring you good news:
For another take on #3, during the job-destroying periods of 2009, per hour labor productivity growth is rising at astonishing rates, try 3.4, 8.4, 7, and 6 percent, each quarter, annualized. That\’s not just the regular accretion of technological progress (though some of it may be), it is an artifact from dumping lower quality and zero MP workers. If I look in the second quarter and see labor hours go down 7.9 percent and see per hour productivity rise 8.4 percent, well, that\’s no proof but I sure go hmm….
US labour productivity is soaring at present: and largely because the workers who have been fired are the lowest to no productivity ones.
All of which should make Paul Krugman and other admirers of the European social democratic model hugely happy of course. The US is now approaching French levels (OK, getting closer to, hey, without measuring absolute levels we don\’t know whether it\’s passed it yet) of labour productivity per hour.
Which is great of course.
And the US is doing this in the same manner that France does. Firing the only marginally productive and dumping them on the long term unemployment rolls instead (note, long term US unemployment is soaring right now).
My only confusion is that with the US becoming more like continental Europe no one seems to be cheering about it as yet. Even those who have long been arguing that the US should become more like continental Europe.
It\’s a real puzzle, let me tell ya\’.