Technology has turned back the clock on productivity

8th April, 2021

Has the economic clock started to run backwards? The defining fact of economic history is that, over time, humans have been able to produce vastly more of whatever goods and services they value.

In The Wealth of Nations, Adam Smith had no doubts that the foundation of this dizzying economic growth was specialisation — the division of labour. Yet much modern knowledge work is not specialised at all. Might that explain why we all seem to be working so hard while fretting about getting so little done?

As Philip Coggan writes in his epic history, More: The 10,000 Year Rise of the World Economy, Smith’s 1776 book was not the first to note the productivity gains that resulted from specialisation. Xenophon was making similar remarks in 370 BCE.

But why does the division of labour improve productivity? Smith pointed to three advantages: workers perfected specific skills; they avoided the delay and distraction of switching from one task to another; and they would use or even invent specialised equipment. 

The modern knowledge worker fits uneasily into this picture. Most of us don’t use specialised equipment: we use computers capable of doing anything from accountancy and instant messaging to filming and editing video. And while some office jobs have a clear production flow, many do not: they are a watercolour blur of one activity bleeding into another. 

I first noticed this reversal 20 years ago. At the time, economists were puzzling over why computers did not seem to have boosted productivity. Meanwhile, I had an office job with a bewildering variety of responsibilities. Sometimes I was doing research and analysis, sometimes I was figuring out what font to use on a PowerPoint slide.

Office work is becoming ever more generalist. Everyone does their own typing nowadays, and many people do their own expense claims, design their own presentations and manage their own diaries. We all have access to user-friendly software, so why not?

In 1992 the economist Peter Sassone published a study of workflow in large US corporate offices. He found that the more senior a person was, the more likely they were to do a bit of everything. Administrative assistants did not do management, but managers did do administration. Sassone called this “the law of diminishing specialisation”.

This law of diminishing specialisation is surely stronger today. Computers have made it easier to create and circulate written messages, to book travel, to design web pages. Instead of increasing productivity, these tools tempt highly skilled, highly paid people to noodle around making bad slides. Variety is pleasant, and it is all very well to bake sourdough or knit cardigans as a hobby — but a high-paid office job is no place for amateur hour. 

Is this a real problem? It might be. Adam Smith describes a pin factory employing 10 specialists producing 48,000 pins a day. A single generalist, operating without specialised equipment, “could scarce, perhaps, with his utmost industry, make one pin in a day, and certainly could not make twenty”. Nobody would expect a 4,800-fold productivity increase if modern knowledge workers spent a little less time coordinating meetings over email and a little more time focusing on the key aspects of their jobs. But even a twofold increase would be worth taking seriously.

Cal Newport’s new book, A World Without Email, is searing on this point. Examining scientific management studies from the early 20th century, Newport makes the case that manufacturers analysed and fixed their aimless processes a century ago. The gains were dramatic. 

For example: at the Pullman factory complex near Chicago, people from various departments would wander into the brass works and pester the metalworkers until they got what they needed. After a systematic overhaul, many clerks were hired as gatekeepers and to plan and schedule work. Productivity soared. 

Newport argues that knowledge work is long overdue a similar rethink. How often is office work assigned and prioritised by random pestering? Certain disciplines, including producing a daily newspaper, have developed a clear workflow that doesn’t depend on long email chains. A lot of knowledge work, however, is still in the “wander in and pester” stage. Newport argues that managers and administrators alike should be protecting specialists from distraction, and that we can do much better if we rethink our processes from the ground up. 

Turning the office into another assembly line doesn’t sound fun. Smith, famously, fretted that repetitive, simple specialisation would lead a worker to become “as stupid and ignorant as it is possible for a human creature to become”. In an 18th-century pin factory, perhaps, but less so for 21st-century knowledge work.

A very different passage in The Wealth of Nations is closer to the mark: “Men are much more likely to discover easier and readier methods of attaining any object, when the whole attention of their minds is directed towards that single object, than when it is dissipated.”

No one is longing for a return to the pin factory. Modern knowledge work is nothing like pin-making, and the variety that comes from a hyperactive reliance on email is not the kind that allows us to flourish. My own ideal is what I call “slow-motion multitasking”: have a variety of projects in progress, allowing them to cross-fertilise each other. But do one thing at a time.

Written for and first published in the Financial Times on 12 March 2021.

My new book, “The Data Detective” was published in the US/Canada on 2nd February. (Elsewhere the same book is titled “How To Make The World Add Up”.)

“Nobody makes the statistics of everyday life more fascinating and enjoyable than Tim Harford.”- Bill Bryson

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