Productivity, one of the factors vital to the nation’s economic health, once again figures in the news, with: 1. A Labor Department report that output per hour worked at the nation’s businesses (excluding famis) fell at a seasonallyadjusted 8.9 percent annual rate for the second quarter. 2. Release of the Joint Congressional Economic Committee’s midyear report expressing concerns about productivity declines and outlining eight recommendations for reversing the trend. Labor Department analyst J .R. Norsworthy cautioned against attaching “too much significance” to the second quarter productivity dip after a 4.3 percent increase in the first quarter. “It isn’t uncommon for a decline to follow a very rapid rise,” he said. The long-range report of the Joint Economic Committee gives more cause for concern. Sen. Roger W. Jepsen, R-Iowa who reported on the 20-member panel’s study said it is vital that a long-range productivity slump be reversed “if we are to restore America’s economic health.” During the three decades after the end of World War II, the American economy was the strongest and most productive in the world. Jepseu said. “Since 1973, however, our productivity growth has deteriorated sharply. “Between 1950 and 1965. the productivity level grew at an annual rate of 3 percent, For the period from 1967 to 1973, the annual rate was 2,4 percent. Between 1973 and 1980, the country experienced a dramatic drop in productivity as the rate of growth fell to 0.6 percent annually.” To keep the picture in perspective, the senator said America still was “the highest level of productivity in the world. He explained that “discussions about declining output refer to a decline in the rate of productivity growth and not total productivity.” However, if current trends continue. “it will not be very long before many of the other industrialized countries achieve productivity levels that meet or exceed the productivity of the American worker.” Jepsen said. Declining output, the committee concluded, has far-reaching effects on the nation’s economic health, spurs inflation and unemployment, weakens the U,S, trade position, and prevents any general improvement in the standard of living. On the other hand, higher productivity is vital if America is to “restore its image and position of strength in the world, stop the inflationary spiral, and create jobs.” Congress has recognized the importance of this issue, Jepsen noted. “The effort to reverse the productivity slump now takes center stage in virtually all congressional economic policy discussions.” Here, in brief, are recommendations of the joint committee: – Government should pursue policies to promote economic growth, reduce inflation and increase employment. – Tax system revisions are needed to encourage productivity improvement in the private sector. – Conditions for lower interest rates are vital to stimulate investment in business. agriculture, housing and research. – Improve investment in vital public and private infrastructure. including highways, ports, railroads, utilities, etc. – Government should reduce the burden of paperwork and anticompetitive economic regulation, – Improve productivity within government. which would tighten the budget andfree resources for use in the private sector. – Encourage business to develop new emphasis on long-run competitiveness in product development, production, engineering and marketing, – Labor and management should expand cooperation in improving long-run productivity and competitiveness. Obviously, increasing productivity and competitive spirit is a team effort, Govemment has a role; so have business. labor, and the American people in general. America need not be ashamed of its record. Economic and productivity miracles have been wrought in the past. Teamwork and positive attitudes can meet the new challenges of today. The Joint Economic Committee has rendered a service through its study and report. The document should be circulated widely, with appropriate action on the recommendations.