Reserve Bank gives wrong data on productivity
AIDC researchers have uncovered incorrect Reserve Bank productivity data, claiming a 20% drop in productivity. In reality, productivity has climbed in the contradiction to Reserve Bank reports. Workers are in fact workers are adding greater value over time to the national income. The misleading data is being used by the business media against unions engaged in wage bargaining.
The fallacies started in a Discovery Invest article and continued on to a Money Web blog before being picked up by Wednesday's Business Day editorial (20/7).
The editors of Business Day do note that OECD says that SA has a "relatively strong development of labour productivity". They also note the strange fact that the entire decline in labour productivity seems to have taken place between 2000 and 2003, which might "suggest that there is some statistical issue".
Indeed, any economist with some semblance of reality would regard a productivity drop of 20% within three years as completely impossible, precluding some catastrophic external cause. But wage bargaining is going on and this "scientific" ammunition against workers is too good to be wasted by the entrenched business community.
The productivity index series presented in the statistical tables on page 133 in the SARB June 2011 Quarterly Bulletin is based on misleading data. AIDC has confirmed this with the responsible researchers at SARB. The major source of these distortions can be seen in the increase in financial sector employees from 195 000 in year 2000 to around 1 779 019 by 2010.