A couple of weeks after the quarterly GDP report, the government tells us the news on productivity: output per hour. Here’s the Cliff Notes: if GDP was up a lot in the quarter, then productivity was up. If GDP was weak, then productivity was weak. Good explanation over at KNZN, the vowelless blogger. Be sure to read KNZN’s follow up in the comments section. I don’t always agree with him, but he’s spot on in this post.
Business Strategy Implication: Ignore the quarter-to-quarter changes in productivity.