Productivity up, employment down: Is squeezing workers good for America?

Productivity, the amount that each worker produces per hour, rose 6.6 percent in the second quarter. quarter. That huge increase (analysts expected a 6.4 percent rise) came as the amount they produced fell 1.5 percent. But the reason for this increase in productivity is fairly straightforward: nearly seven million people are unemployed and hundreds of thousands lose their jobs each week. While higher productivity sounds great, you have to wonder, is this good for America?

It depends on what the meaning of America is. If by America, you mean American workers, the answer is ambiguous. That's because the high productivity means that the workers who remain employed are probably the best ones and they are likely to benefit as demand revives. Moreover, any worker whose 401(k) is invested in stocks will benefit as increased corporate productivity yields higher profits and stock prices.