And you thought "credit swaps" were bad! Wait until we get into the "productivity swap" bubble. This is the warning from John Psarouthakis, successful entrepreneur, and Tom Ferguson, musical entertainer. They say in Other Voices column of the January 12 issue of Crain's Detroit Business that the productivity of companies is shifting from employees to customers and this shift is not being recognized in measures of output. They write:
For every tick of productivity a customer expends, productivity ascribed to that company should be reduced two ticks: one because it didn't do the work, another because it outsourced the work, making it a debt.
This outsourcing of productivity is obvious to me...now that Psarouthakis and Ferguson have brought it to my attention. The classic is customers pumping gas, washing car windows,and checking oil at so-called "service stations". Also, customers must already know the answers to their own questions when calling an automated (so-called) "help desk" or else they won't get to the right information. Grocery stores are installing automated check-out stations where customers do all the work pricing and bagging groceries. Airlines penalize customers for not using online services to make their own travel arrangements and issue their own tickets and then airlines want customers to check their own bags at the airport. Book stores are rewarding their customers for ordering books online, thereby eliminating the need for knowledgeable, helpful store clerks. And, of course, there are the ubiquitous ATMs which have shifted the work of personal banking from tellers and bankers to bank customers.
The swap is on. What will happen when this productivity bubble bursts? Will we discover that our GNP has been a sham and that much of what was thought to be worker productivity is really customer productivity? Will there be a backlash against this shift? What effect will this have on our fragile economy?