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Work in progress: social media has a productivity problem

Date: December 29 2012

Technology is supposed to drive business, yet Twitter and Facebook seem to stall it, writes CAROLINE BAUM

Ever since the invention of the wheel in Mesopotamia about 3500 BC, technological innovations have been improving our lives. Because new devices and processes help us produce more (output) with less (labour input), prices fall, real wages rise and we are all better off. If there is a free lunch in this world, it's productivity growth.

There is even an economic school of thought, known as real-business cycle theory, which views technology shocks as the main driver of the business cycle: not the central bank, not fiscal policy, not animal spirits or expectations.

Technology, in fact, is always equated with good: more is better.

Don't get me wrong. I'm all for progress, but I keep wondering if some of the latest innovations are productivity-enhancing or just a waste of time.



I didn't have to wait 20 years. Sherry Turkle, a professor at Massachusetts Institute of Technology, described this phenomenon perfectly in an April 21 article in The New York Times titled, ''The Flight from Conversation''. She called it ''alone together''. It encapsulated everything I had been thinking about for years.

''We live in a technological universe in which we are always communicating,'' Turkle, a psychologist, wrote. ''And yet we have sacrificed conversation for mere connection.'' Social networking is an alone-together pursuit.


At first I restricted my tweets to my column and blog posts. I never looked at Twitter in between. Then I started interacting with people, and it became contagious, more like a game. Who was retweeting my posts? How many followers did each tweet produce? What was my tweet-to-follower ratio? My most attention-grabbing tweet was something snarky I wrote on November 14 during the David Petraeus scandal: ''Both Petraeus & Broadwell were married. Yet now she's his 'mistress.' Do we have an equivalent word in English for him?''


To find the answer, I decided to go to the source on labour productivity: the US Bureau of Labour Statistics. I asked one of the economists who works in that division if he could help determine how my personal productivity was being affected by tweeting. Once I became an expert, I was sure I could extrapolate the results to the universe at large.

You probably guessed: it's not that easy. In its monthly calculation of output per hour worked, or productivity, the bureau uses revenue, or nominal sales, as a proxy for output. That revenue is then adjusted for price changes. Total hours worked, which businesses report to the bureau each month, is used as a proxy for labour input. Productivity is computed from the two numbers.


Goods can be adjusted for quality changes: something the bureau does each month to determine what part of the change in the price of a consumer good is due to improved quality. It's harder with services industries and is almost impossible for my output. Readers, however, have no problem providing an instantaneous qualitative assessment: it stinks.

The good news is, until my slacking off starts to affect Bloomberg sales, my personal productivity isn't captured in the statistics. The bad news is, I may lose my job.






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