The Productivity Myth

Ben was a child of the nineties. Finished University with no debt after benefitting from free fees and found himself entering the workforce just as the Irish economy cub was growing into a full-sized Tiger.

After a year in Australia, sampling the back packer lifestyle, he returned to Dublin and found a well-paying job in an International Bank. Ben was bright and hard working and steadily worked his way up the corporate ladder. By the mid 2000’s he was married with a couple of kids and drove a flashy company car to match his managerial title. He found himself managing a team of fifty, drawn from all the countries in the EU and beyond. They had daily tasks which they comfortably managed. So, Ben threw in some project work to keep them interested and on their toes.

He was a popular boss and saw his primary responsibilities being to his team, a virtue not shared by most of his peers. His boss loved him. Clients were happy, targets were being met and Ben had worked hard on improving processes so that errors didn’t happen.     

Then his boss left and was replaced with an American straight out of the Arse Hole production line in New York. On his first day, he said that Ben’s department could be cut to twenty-five, which was remarkable as he didn’t even know what the team did at that point.  Ben went through all the projects he had completed, and the American dismissed them as irrelevant as they had all been focussed on accuracy and not head count. He brought up his previous company where they could do the same task with half the staff, although he was scarily light on the details.

Ben brought up quality, customer satisfaction, staff retention and all the other things he was proud of. Brad, the American, only saw numbers and made it clear that if Ben didn’t play ball, then the process would happen without him.

The next twelve months were hell for the team. First of all, their stationary budget was cut and they had to bring pens in from home or steal them the local lottery ticket store. Highlighters were being sold on the black market and paper for the printers was moved to a locked cupboard on the top floor with Kafkaesque levels of bureaucracy to access it.

While this was going on, the team was being pushed for greater efficiency and to also take on more clients with no extra staff. Ben and his team managed this by releasing improvements in line with the company growth. In that way, they never had to lay anyone off.

It wasn’t always comfortable. There is a limit to how much efficiency you can bring, and extra workload wasn’t matched to this.

At the end of the year, the Christmas Party was cancelled but Ben brought his team out anyway and they celebrated a tough but rewarding period.

He trudged back to work though the January rain to find a note on his desk asking him to call into Brad’s office as soon as he got in. Brad was hunched under his screen and motioned for Ben to sit. After a ten-minute wait, Brad swivelled his chair and rested his elbows on his desk.

“Keep this to yourself”, he said. “But we’re moving the operation to Malaysia. We can hire one hundred people there and still do the job for 50% less than here. I want you to pick your best 5 guys and we’ll fly you and them out to Kuala Lumper for a month to train the new team. The company is paying minimum redundancy to the team, but we’ll throw in five grand extra for the people who go to Malaysia. But it doesn’t really matter if you go or not. One thing I’ll say is that your documentation is top class.”

Ben sat dumbfounded. Instinctively, he felt that there must be somebody he could appeal to. A higher power, a union perhaps. But he realised that there was no one. He had signed an individual contract which gave the employer all the benefits, apart from a decent salary, which was the only clause that Ben had read before he signed.

He went back to his desk and searched for how many times that ‘productivity’ had been mentioned in emails from boss. It turned out be used almost daily.

Productivity improvements get talked about as though they are oxygen or water. Beneficial to all equally. The truth is that this is just another lie that Capitalism peddles. Even though the workers may have developed automation or efficiencies themselves, this improvement will lead to higher profits at the top and the risk that the people who did the hard work to introduce the automation will lose their jobs as a result.

In 1930, Keynes predicated that within a century we would be working a 15-hour week due to technological progress. Rather than try to earn more money, we would take the benefit in time off.

We are four years away from the centenary of this essay and I doubt if many people will be working two day weeks by then. Capitalism likes to think that this is because of human ambition. Offered enough to get by and a two-day work week, we’d strive for more and take up a second job. The flaw in this argument is that Keynes believed that companies would pass on the benefits to their staff. That if you could do your job at twice the speed that you used to because of AI, then the company would still pay you a full wage but allow you to work for fewer days.

The truth is that companies have and always will take the profits from productivity for themselves.  Why should AI be any different? Unless of course the workers are smart enough to use AI to make their jobs easier without telling their bosses. Brad would be too stupid to notice and Ben would agree.