Coatings producers that improve productivity faster than their competitors will prosper as the economy revives, enabling them to have full fill lines. Overall coatings productivity growth over the last 24 years has been underwhelming. Best defined as units of output compared to units of asset inputs – labor, capital, managerial skills, and/or better technology – overall productivity has actually declined in this period, according to figures compiled by the Bureau of Labor Statistics (BLS) of the Department of Commerce (Table 1).
Overall productivity actually declined an average of 1.0% annually from 1987 to 2011, the most recent year for which statistics are available. According to the BLS, productivity plummeted 5.5% annually during the 2007-2009 period and then skyrocketed 5.2% annually during the next two years. This record reflects first the disastrous business conditions affecting coatings users during the recession. Since typical coating producers are highly automated, they have fewer opportunities to reduce employment to match declining sales than do less-automated industries. But as coating consumption increased as user industries recovered, coatings producers could operate their plants more fully. With relatively few workers, running fill lines longer and faster produced their employees’ jump in productivity.