Despite 15 months of quarter-to-quarter growth in U.S. real gross domestic product (GDP), the unemployment rate remains stubbornly high and well above other economic recoveries of the same maturity. While the official U3 employment measure has begun to show slight improvements, the broader U6 and U7 measures show much less improvement and remain essentially flat.
A focus on Reliability Excellence results in improved performance without adding more jobs
The overall confusion about the data is further amplified when viewed in terms of the stock market and corporate profits. With corporate earnings driving the major market indices to all-time highs, it is no wonder that the headlines are focusing on a jobless recovery thesis. What is driving this disconnect between economic growth and stubbornly high unemployment?
While there are a multitude of fiscal and regulatory policy issues in the spotlight, my experience from “spending time at the gemba” suggests a strong contributing factor: companies are diligently pursuing a reliability-based strategy designed to maximize the utilization of their plant and equipment and driving stability and efficiencies throughout all key processes. A focus on reliability excellence is resulting in improved performance and increased profits without having to add jobs.
Identifying reliability excellence as a factor in explaining a jobless economic recovery is supported by substantial first-hand knowledge of what companies are actually focused on as the economy recovers. As a leader of a professional services group that specializes in partnering with companies to help them establish and sustain reliability and maintenance best practices, I can personally attest to the strategic emphasis companies are placing on developing a reliability function as a core competency.