The Need for Federal Action To Improve National Productivity

Since the existence of a serious productivity problem in this country is widely accepted, a national commitment to improve productivity and a national productivity plan are needed. Over the past decade, attempts to improve productivity were made by simply establishing organizations. A lack of support for these organizations has demonstrated that to improve productivity effectively in this country, a national commitment must be made. The current National Productivity Council, established in 1978, appears to suffer from the same lack of support and commitment as the previous efforts. A current review of the Council's overall effectiveness indicates that the Council has not met its charges. It has not coordinated or guided the actions of Federal agencies to improve productivity, provided legislative or administrative proposals for productivity improvement, or attempted to seek the advice and assistance of business, labor, and academic leaders concerned with productivity. The private sector must be involved in the development of a national productivity policy to ensure that rational and realistic policies are developed and to help build the cooperation and trust between the private and public sectors that is lacking. It has been estimated that nearly $1 billion was spent on projects directly related to productivity improvement during fiscal 1976, and about $2 billion was spent during fiscal 1979. These productivity improvement efforts have not been evaluated and are not part of a broader strategy. A national productivity plan, backed by a strong council, is needed to harness and direct these funds and activities and ultimately improve productivity. It has been recommended that a National Productivity Council with its own budget authorization be established by law. As a statutory body rather than an organization established by Executive Order, the Council would have greater authority and stability, and would be accountable to Congress. It has also been recommended that a National Productivity Plan be developed with the extensive involvement of business, labor, and academic representatives as well as the existing national and regional productivity centers. The Plan should be dynamic, and must be updated regularly. It should be used to guide Federal actions to improve productivity and enable decisionmakers to put productivity-related proposals into a meaningful context.