Productivity is one of the measures of Americas economic well-being – and Labor Department figures for 1980 indicate that output still needs major national focus. For the third consecutive year, productivity among U.S. businesses declined. Economists usually interpret a decline in productivity (the nation’s output of goods and services per hour of work) as contributing to a rise in inflation. Productivity in the nonfarm business sector was off .5 percent in all of 1980. Production per hour of work at private businesses (including farm output! fell .3 percent. Manufacturing productivity held to the 1979 level. A continuing downward spiral worries economists because when productivity lags and wages rise. the labor cost of producing a unit of output goes up. and this puts pressure on businesses to raise prices. explains the Wall Street Journal. Unit labor costs were 10.3 percent higher in 1980 than in 1979. said the Labor Department report. Productivity gains are considered important to real economic growth, and for keeping U.S. products competitive overseas. The Journal quoted Harold Nathan. financial economist for Chicago’s Continental Illinois National Bank St Trust Co. as saying business productivity likely will gain slightly this year “because the economy is going to be generally improving and sectors hard hit by declines in 1980 should recover somewhat.” Nathan believes also President Heagan’s plans to cut taxes, accelerate depreciation and trim federal regulations also will have positive effects, at leas-t by 1982. These are hopeful signs,. but productivity still re mains a major challenge that merits the attention of all in the businessindustry-labor sector and the concem of the entire nation.