Productivity of Labor

the fruitfulness or productiveness of people’s productive activity. The productivity of labor is measured in terms of the quantity of output produced by a worker in material production per unit of labor-time (an hour, a shift, a month, or a year) or in terms of the time spent in producing a unit of output. K. Marx wrote that an increase in the productivity of labor should be understood as “generally, an alteration in the labor process of such a kind as to shorten the labor-time socially necessary for the production of a commodity, and to endow a given quantity of labor with the power of producing a greater quantity of use-value” (K. Marx and F. Engels, Soch., 2nd ed., vol. 23, p. 325).

Two types of labor are involved in the production of any good: living labor, or labor expended by workers in the process of producing a good, and past (embodied) labor, or labor expended in previous stages of social production and utilized to produce a particular good (buildings and machinery in part and fuel, energy, raw materials, and auxiliary materials in their entirety). The social productivity of labor is defined as the quotient of the total physical volume of the national income and the total number of workers employed in material production.

As the productive forces develop, living labor puts into operation an ever-increasing quantity of embodied labor. Noting this general law, Marx wrote: “The increase in labor productivity consists precisely in that the share of living labor is reduced while that of past labor is increased, but in such a way that the total quantity of labor incorporated in the commodity declines; in such a way, therefore, that living labor decreases more than past labor increases” (ibid., vol. 25, part 1, p. 286).

Increased productivity of labor is one of the objective economic laws inherent in every socioeconomic formation. This law is manifested in the fact that, owing to the development of the productive forces, society can reduce the socially necessary expenditures of labor for the production of certain goods intended for personal or social consumption. As people accumulate experience and knowledge and discover, master, and apply the laws of nature, the productivity of labor increases.

The rate of growth of labor productivity varies, depending on the stage of development of society. In the period of the primitive communal system the productive forces developed slowly. According to the latest estimates, which are based on the oldest discovered human fossils, mankind has existed for more than 2 million years. Most of human history is part of the Stone Age, which was characterized by primitive, stone instruments of labor with a low level of productivity. The first metal tools, which were made of copper, were used about 6,000–7,000 years ago. Later, bronze tools were made, and for a long time copper and bronze tools, as well as stone tools, were used. Iron tools appeared at the beginning of the last millennium B.C. The transition from stone to metal tools, especially iron tools, was accompanied by accelerated rates of growth in labor productivity and by the emergence of the social division of labor.

As F. Engels pointed out, iron proved to be the most important raw material and played a revolutionary role in history. Even after the appearance of iron tools, however, the productivity of labor grew slowly, increasing by an average of only 4 percent every 100 years, because for a long time the fundamental basis of production remained the manual labor of slaves and serfs. The productivity of labor began to increase rapidly with the transition from hand tools to machines. The invention of the steam engine in the second half of the 18th century brought about the industrial revolution, with radical changes in production methods, accompanied by a dramatic leap in the rate of growth of labor productivity.

In antagonistic class societies the results of an increase in the productivity of labor are appropriated by the ruling classes for their personal enrichment. Nevertheless, as Marx wrote, the essence of the law of increased productivity of labor is that the maximum output is produced by minimum labor. Therefore, an increase in the social productivity of labor objectively contributes to human progress, as manifested in the expansion of material production and in advances in science, culture, the arts, and all aspects of civilization. In the final analysis, each mode of production overcomes and replaces its predecessor because it provides greater scope for development of the productive forces of society and for an increase in the social productivity of labor. Feudalism vanquished slaveholding society because it created conditions that encouraged people to have a material interest in their labor, thus opening much greater possibilities for increasing the productivity of labor.

Capitalism provided extensive possibilities for the development of the productive forces by freeing society from feudalism and transforming the toiling masses into proletarians forced to sell the only commodity they possessed—their labor power. Thus, large-scale capitalist production was established, on the basis of the social division of labor, machine technology, and harsh exploitation of wage labor. As Marx pointed out, rapid development of the productive forces, which is absolutely impossible under the preceding social formations, “is the historical task and justification of capital. This is just the way in which it unconsciously creates the material requirements of a higher mode of production” (ibid., p. 284).

Under the conditions of capitalist society, in which the worker is confronted and opposed by private property in the means of production and subjected to exploitation, “the law of increased productivity of labor is not absolutely valid” (ibid., p. 288). This Marxian tenet is confirmed by the entire history of the capitalist mode of production. Capitalist society is characterized not only by tremendous acquisitiveness and miserliness but also by an extremely wasteful attitude toward the productive forces, especially the working people—the principal productive force. As a result of the extensive introduction of new technology in all sectors of the capitalist economy, workers are driven out of production, and unemployment increases. Consequently, society loses the labor of millions of people, who are rendered superfluous under an anarchic system of production. Also characteristic of capitalism is chronic underutilization of production capacity. This is especially evident during crises of overproduction and periodic recessions, which lead to a decline in the social productivity of labor and in the standard of living of millions of the working people.

Under socialism the law of increased productivity of labor is absolute, for socialism eliminates the antagonistic contradictions of capitalism and their consequences. V. I. Lenin wrote: “Capitalism can be utterly vanquished, and will be utterly vanquished by socialism creating a new and much higher productivity of labor. This is a very difficult matter and must take a long time; but it has been started, and that is the main thing.… Communism is the higher productivity of labor—compared with that existing under capitalism—of voluntary, class-conscious, and united workers employing advanced techniques” (Poln. sobr. soch., 5th ed., vol. 39, pp. 21, 22). From an increase in the productivity of labor the working people gain an expansion of the social product, the main prerequisite for increasing the national income and national wealth—that is, the main prerequisite for expanded socialist reproduction. The productivity of labor contributes to an uninterrupted rise in the well-being of the people and to the comprehensive development of the individual.

Emphasizing the tremendous role of the economic law of increased productivity of labor, Marx wrote: “The economizing of time, like the planned allocation of labor-time to various branches of production, remains the prime economic law, even on the basis of collective production. It still holds as a law even at a much higher stage” (Marx and Engels, ibid., vol. 46, part 1, p. 117).

In analyzing the productivity of labor, it is necessary to differentiate the conditions, the factors, and the reserves for increasing labor productivity.

Among the general conditions for an increase in the productivity of labor are natural conditions. The labor productivity of workers in a particular country or in different economic regions of a country depends on the presence and accessibility of natural resources, the fertility of the soil, and the climate. Also among the general conditions for an increase in labor productivity are the level of development of a society’s productive forces and the social conditions of labor, or the system of production relations in a particular society. In addition, scientific development ultimately contributes to increasing labor productivity. Under the conditions of the scientific and technological revolution, science has been transformed into a direct productive force and has assumed a particularly important role in raising labor productivity.

The numerous interrelated and interdependent factors involved in raising the productivity of labor may be tentatively grouped in several basic categories, the first of which is the improvement of techniques and technology, leading to changes in the structure of production. This group of factors includes everything that depends on or is a product of modern scientific and technological progress. Emphasizing the paramount role of technological progress, Lenin wrote: “The raising of the productivity of labor first of all requires that the material basis of large-scale industry shall be assured, namely, the development of the production of fuel, iron, the engineering and chemical industries.… The development of these natural resources by methods of modern technology will provide the basis for the unprecedented progress of the productive forces” (Poln. sobr. soch., 5th ed., vol. 36, p. 188).

The second category consists of factors involving improvement in the organization of production, including the rational location of the productive forces, the specialization of industrial enterprises and branches of industry, the fullest utilization of existing equipment, maintenance of the rhythm of production, and improvement of the repair system (in particular, the establishment of the centralized manufacture of spare parts and units for machinery and equipment). In addition, the second category of factors in raising labor productivity includes overcoming or diminishing the seasonal quality of production. The third category consists of factors associated with improving the organization of labor, including better utilization of living labor, increasing the qualifications of personnel and raising the cultural and technical level of the working people, strengthening labor discipline, and freeing workers from certain jobs and employing them rationally and efficiently. The third group of factors also includes improving the system of wages and establishing standards for labor and for providing all workers with a personal, material interest in their work; ensuring an average intensity of labor; and improving working conditions and safety measures. The scientific organization of labor plays an important role in increasing labor productivity at every enterprise. Of special importance in the third group of factors are the organization of socialist emulation, the dissemination of advanced production experience, and the maximum development and encouragement of rationalization proposals and inventions.

If a factor in raising the productivity of labor is not used in the production process, it is referred to as a reserve for increasing labor productivity. Reserves are classified according to their association with a particular production process, an economic sector, or the national economy.

In accounting and in planning labor productivity in the USSR and other socialist countries, value (cost) measurement is the method most widely used to determine the existing level, dynamics, growth rates, and indexes of the productivity of labor at various enterprises and for various periods of time. This method is used not only for individual enterprises but also for economic sectors or ministries, republics, and the national economy as a whole. In industry the productivity of labor is determined by dividing the total volume of gross output (at wholesale prices) by the average number of scheduled production personnel in all industrial production. In agriculture, labor productivity is determined by dividing the gross output (in comparable prices) by the average annual number of agricultural workers, and in construction, by calculating the volume of construction and assembly work (at estimated prices) per worker employed in that type of work or in enterprises subordinate to construction organizations. In transportation, labor productivity is determined by dividing the volume of work (in adjusted ton-kilometers) by the number of workers.

Among the other methods used to measure the productivity of labor are measurement in kind, in conventional physical units, in labor, and in net output and conventional units of net output. However, not one of the methods has ensured accurate measurement of labor productivity, and all of them frequently result in considerable distortions in calculating the dynamics of labor productivity at enterprises and in particular branches of industry, in connection with changes in the assortment of goods produced, in labor intensiveness, and in the organization of production.

During the period of socialist construction the Soviet people have been very successful in increasing the productivity of labor. Between 1913 and 1974 the productivity of labor in Soviet industry increased by a factor of 23.3, and in agriculture by a factor of 6.2. The labor productivity of the USSR has also changed, relative to the capitalist countries. In 1913, the labor productivity of Great Britain and France was three to five times greater than that of Russia, but in 1973 the labor productivity of those countries was lower than that of the USSR. In 1913 the labor productivity of Russian industry was one-ninth that of US industry; in 1973 the labor productivity of Soviet industry was approximately half of that of US industry.

Labor productivity is playing a greater role in the growth of output. Under the first five-year plan (1929–32), 51 percent of the increase in industrial output was due to increased labor productivity. Under the eighth five-year plan (1966–70), this figure rose to 73 percent, and during the first four years of the ninth five-year plan (1971–75), to 84 percent. The significance of labor productivity in shaping the national income has also increased. In 1973, 85 percent of the increase in national income was due to increased labor productivity.

In the USSR, in accordance with the demands made by the Communist Party and the socialist government, special attention has been paid to raising labor productivity in agriculture, where the entire increase in output must be obtained without increasing and even by significantly reducing the number of workers. The strengthening of the material and technical basis for agriculture in every possible way is of crucial importance in carrying out the comprehensive program for increasing labor productivity in agriculture. The state and the kolkhozes invested as much in agriculture under the ninth five-year plan (1971–75) as under the two preceding five-year plans.

Other socialist countries have also achieved high rates of growth in labor productivity. For example, between 1950 and 1973 the labor productivity per worker in industry increased by a factor of almost 3 in Hungary and the Mongolian People’s Republic, by 3.7 in Czechoslovakia, by 4.3 in the German Democratic Republic, by 4.5 in Poland and Bulgaria, and by 5.3 in Rumania.

In the capitalist countries, growth rates for labor productivity in industry were lower. During the same period (1950–73) labor productivity per worker increased in Great Britain by a factor of 1.9, in the USA by 2.2, in the Federal Republic of Germany by 2.9, and in France by 3.3.

The continuing growth of labor productivity in developed socialist society is especially significant because it is associated with the transition of the Soviet economy from a primarily extensive to an intensive type of economic development, in which expanded reproduction is increasingly achieved by accelerating technological progress and by raising the productivity of labor. The growth of labor productivity also plays a very important role in fulfilling the main economic task confronting the party and the Soviet people—the creation of the material and technical basis for communism. The attainment of a significant superiority in labor productivity over the industrially developed capitalist countries constitutes an extremely important condition for victory in the economic competition between the two social systems.