back to front page back to headlines Back to Theory feedback

Big Lies, Little Lies, & Statistics

By Jim Lane

There's a crisis for older workers. The bosses tell us they can't meet pension obligations because there are too many retirees and not enough active workers. They use the same argument to explain why they have to gut Social Security.

People tend to believe them when they quote figures such as, "There were 4 active workers for every 1 retiree when we started this pension plan, but now there are only 2 active workers for every retiree, so we're just not getting the income needed to meet these retirement obligations."

The whole approach is a lie.

Here's why: they assume that one active worker in some previous year equals one active worker today. The truth is that one worker today produces a great deal more wealth for their bosses than one worker in a previous year.

I asked the Bureau of Labor Statistics for productivity increases since 1938, but all they had was 1947 to 2003. That is more than enough to show what I mean. Their numbers show increases in dollar value produced per hour of Private-Sector work based on 1992=100. Since I wanted the earliest year, I changed the index to 1947=100. Those are the figures in the last row of the table below.

A quick glance shows that an hour's work produced twice as much wealth in 1969 than it did in 1949. Productivity doubled again by 2003, so that an hour of work in 2003 was worth FOUR hours of work in 1949!

Incidentally, the big difference comes primarily from automation, but some of it comes from improvements in methods of work and from smarter workers. No matter where it comes from, the effect is the same: one hour of work today produces much more wealth than one hour of work in earlier years. When the bosses tell us the value of an hour is the same, they are lying.

In fact, it's much worse than these numbers show. A quick glance at Juliet B Schor's wonderful book, The Overworked American shows that Americans are working more hours than before. From 1969 to 1987, she shows a yearly increase of 162 hours! Capitalists were just getting started at driving American workers harder in 1987; it's more than 162 now. The prediction for 2005 has to be even much larger, because President Bush has just removed overtime pay protection from millions of American workers. They'll still be getting overtime, just not overtime pay! The number of hours worked will continue its sharp ascent!

Here are the productivity numbers from the U.S. Bureau of Labor Statistics:

1992=100 1947=100

1947 32.4 100
1948 33.9 104.6296
1949 34.7 107.0988
1950 37.5 115.7407
1951 38.7 119.4444
1952 39.7 122.5309
1953 41.1 126.8519
1954 42 129.6296
1955 43.8 135.1852
1956 43.8 135.1852
1957 45.1 139.1975
1958 46.4 143.2099
1959 48.1 148.4568
1960 48.9 150.9259
1961 50.6 156.1728
1962 52.9 163.2716
1963 55 169.7531
1964 56.8 175.3086
1965 58.8 181.4815
1966 61.2 188.8889
1967 62.5 192.9012
1968 64.6 199.3827
1969 64.9 200.3086
1970 66.2 204.321
1971 69 212.963
1972 71.2 219.7531
1973 73.5 226.8519
1974 72.3 223.1481
1975 74.8 230.8642
1976 77.2 238.2716
1977 78.5 242.284
1978 79.3 244.7531
1979 79.4 245.0617
1980 79.2 244.4444
1981 80.8 249.3827
1982 80.2 247.5309
1983 83.1 256.4815
1984 85.3 263.2716
1985 87.2 269.1358
1986 89.9 277.4691
1987 90.4 279.0123
1988 91.7 283.0247
1989 92.6 285.8025
1990 94.5 291.6667
1991 96 296.2963
1992 100 308.642
1993 100.3 309.5679
1994 101.5 313.2716
1995 101.6 313.5802
1996 104.6 322.8395
1997 106.5 328.7037
1998 109.4 337.6543
1999 112.6 347.5309
2000 115.9 357.716
2001 118.8 366.6667
2002 123.9 382.4074
2003 129.5 399.6914 (29.5% more than in 1992! Four times as much wealth per hour as in 1947! )