Summary: The productivity problem is a major contributing factor to the economic problems facing the country. The problem is national in scope, and a national effort involving both the Government and the private sector will be necessary to solve it. GAO is examining the productivity problem at the request of the House Subcommittee on Trade. Part of that study was a discussion involving top-level representatives from industry, labor, and academia, where several important points were made, including: (1) labor and management must alter existing adversary relationships in order to successfully initiate productivity and quality efforts; (2) additional capital must be made available for productive investment; and (3) Government should have a productivity focal point that will support increased cooperation among industry and Government and the coordination of Federal productivity efforts. Although national productivity largely depends on the performance of business, Government plays an important role in establishing the broad economic, legal, and social framework within which business operates. The National Productivity Council was established as an organization responsible for providing coordinated and effective Federal programs to improve productivity. With minor exceptions, the Council has not met its charge. The Council has not coordinated or guided the actions of Federal agencies to improve productivity, has not provided legislative or administrative proposals for productivity improvement, and has not attempted to seek the advice and assistance of business, labor, and academic leaders concerned with productivity. A national productivity plan, backed up by a strong council, is needed to harness and direct funds and activities, and ultimately to improve productivity. The productivity plan should: (1) identify and describe the relationship and effect of existing Federal policies, programs, and activities on private sector productivity; (2) delineate clearly the responsibilities of Federal departments and agencies having direct program functions within the plan; (3) identify existing unnecessary obstacles to productivity improvement created by the Federal Government; (4) provide alternative policies, programs, activities, and lines of responsibility to improve private-sector productivity; and (5) contain a priority listing of short- and long-term objectives, and specific projects and programs for the next year to attain these objectives.
