Gordon T Long

Gordon T Long

Global Macro Research | Macro-Technical Analysis 





The rate of change of US Productivity has been steadily declining since the 2008 GFC and has now begun to accelerate, signaling potentially major competitive problems for the US are ahead.

Though the rate of increase has been falling, US productivity until recently had still been rising. However, this had been at the expense of Real Wages not even coming close to keeping up (see chart in “What You Need To Know” below right). This divergence is now forcing inflation in wages and benefits which is not going to be easily resolved, since the US Labor force is changing in profound and structural ways. We have tried to highlight these shifts in this month’s video and newsletters.



  • UnderTheLens-08-24-22-SEPTEMBER-US-Labor-Market-In-Productive-Decline-Newsletter-2-US-Productivity-v-Real-Wages imageUS MUST URGENTLY INCREASE LABOR PRODUCTIVITY
  • Nobel Laureate Edmund Phelps is correctly shouting that “we need to urgently get productivity growth on an upward climb approaching what it was in the 50s and 60s!”
  • Gen Z & Millennials are saying “NO” to workload expectations that prior generations accepted as the price of getting ahead. Now work force demands personal balance!
  • Apple (Technology) and JPMorgan (Banking) are just two more visible conflicts occurring in the new post Covid-19 workplace. 
  • The environment is ripe for a surge in increasing Union demands and the potential rise of new Union organization! 
  • In most major cities commercial real estate (and the financial and law firms that fill millions of square feet) constitute the tax base. A collective flight of workers and the corporations that employ them could lead to a mass economic collapse!
  • Remote work is a serious economic problem. Local and state politicians are screaming for a stronger national narrative, but the Biden administration won’t address it until after the mid-term elections.
  • Will Remote Work soon be considered as a taxable benefit for employees but not for contractors?



The current labor shortage is hurting the entire American economy, and the concentration of employment declines among younger & older workers is particularly worrisome. Meanwhile, government interventions in higher education are preventing effective and lower-cost educational alternatives from helping young workers to gain the occupational skills versus the education they need.

Continued low levels of employment will reduce the rate of economic growth, reduce real incomes and output, result in greater dependence on government social programs, require higher taxes, and exacerbate the U.S.’s already precarious fiscal situation. Eliminating federal distortions in education and training, minimizing tax burdens, encouraging flexible work, reducing unnecessary regulation, removing work disincentives in federal entitlement programs, and making welfare work-oriented will increase incomes and the size of the workforce.


The Gen Zs are the most educated in US history and are therefore staying in school longer. Advanced degrees are increasingly the norm. Pharmacists today require PhDs for certification. Speech Therapists and Physical Therapists require Masters etc.


Baby Boomers are retiring earlier than previous generations as well as many taking early retirement as a result of Covid-19.

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CHART ABOVE:  Working Age Demographics have stayed relatively flat while the younger and older participation rates have plunged thereby plunging the overall labor participation rates.

CHART BELOW: US population growth & immigration policies have not allowed the labor force to keep up with demand & the generational “work-life balance” priority shifts underway. (Strongly recommend you view this short video for a clear & simple understanding of how Demographics are impacting the US economy).

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U.S. GDP fell 0.9% in the second quarter following a 1.6% drop in the first quarter, though analysts say the economy is not yet in a recession and may avoid one. 

    • Productivity, measured as nonfarm business employee output per house, also fell in both quarters, decreasing by 7.4% and 4.6% quarter-on-quarter. 
    • These were the weakest back-to-back readings since records began in 1947.
    • The U.S. recorded productivity growth of 2.8% from 1947-1973, which fell to 1.2% from 1973-1979, according to data from the U.S. Bureau of Labor Statistics. 
    • Productivity growth has failed to return to its post-war level since coming in at 1.4% from 2007-2019 and 2.2% from 2019-2021.

The U.S. needs to return to the kind of economic and productivity growth it saw in the 50’s and 60’s, according to a Nobel Prize-winning economist Edmund S. Phelps, Director of the Center on Capitalism and Society at Columbia University. Phelps knows what he is talking about. We should listen to him, since he was awarded the 2006 Nobel in Economic Sciences for his work challenging the Phillips Curve, the view, popular in the 1950s and 60s, that the price for reduced unemployment was a one-time increase in inflation. Phelps introduced the factor of inflation expectations into the Phillips Curve, showing unemployment is determined by the functioning of the labor market rather than inflation figures. A stabilization policy can only diminish short-term fluctuations in unemployment.  

    • “We badly need to get back to economic growth. By that I don’t mean an artificial temporary boom or a slower descent into lower employment, I mean that we’ve really got to get productivity growth on an upward climb approaching what it was in the 50s and 60s!”,
    • “It is really important for people’s morale that they come home from time to time with better paychecks than they had before”,
    • “When everybody is doing so-so, when you’re in virtual stagnation in terms of productivity, in that landscape, which we’re unfortunately in now, it’s really important that we get the growth rate up.”

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What started as a quiet movement among office workers looking to draw firmer work-life boundaries after two years of pandemic overtime has now grown into a rallying cry.

The concept has sparked a flood of vehement commentary from business leaders, career coaches and other professionals lamenting what the shift away from hustle culture means for Americans’ commitment to their jobs, while some young professionals are praising it. 

GEN Z / MILLENNIALS: They argue the concept is saying no to extra work without extra pay and work stress.

    • Almost 25 percent of workers between the ages of 35 to 44 said they would likely be quiet quitters in a recent survey from Resume Builder.
    • “For a lot of people, it’s another way of saying they have health boundaries. It means doing what you are paid to do and not sacrificing your wellbeing in order to do more.” 
    • Quiet quitting can look like not taking on extra responsibilities such as serving on a volunteer committee at work or refusing to work more hours than you are paid for.
    • Another example of quiet quitting is choosing to do so physically.  
    • What really encapsulates quiet quitting is the rejection of “hustle culture”, where people believe that they will be given promotions, better pay or better benefits for working beyond the confines of their job.  


    • Quiet quitting mind-set fosters laziness and hurts performance, even if baseline job expectations are being met. 
    • Quiet quitters may think they’re preventing or curing burnout by doing less work, but better options exist. Coasting through your career instead of finding truly engaging work is a missed opportunity, especially when you could find more meaningful work in today’s hot job market.
    • “As an employer, I really love when people in interviews say, ‘I give 100% when I’m working, and these are my boundaries.’ That’s very different from, ‘I do the bare minimum to get by,’”.
    • Some bosses push back against quiet quitting, saying that going above and beyond is the best way to get noticed, get raises and climb the corporate ladder. Many workers are heaping scorn on the term itself, calling out the irony of doing a 9-to-5 job and calling it quitting. 
    • It’s not about the quiet quitters. It’s about everybody else and the unfairness that occurs there. If quiet quitting leads to performance issues those workers should be let go to find jobs that truly engage them.

THE UNDERLYING PROBLEM IS MANAGEMENT: The onus here is on business leaders to set clear performance expectations. If employees are meeting them, that’s what matters, not when or how long they work. Management has the responsibility to have good metrics and measurements for knowing whether somebody’s getting the job done or not. America has as much a management problem as a labor problem!

No matter which side you come out on this conflict, it suggests lower productivity is highly likely

going forward compared to past trends.



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I think an article that I recently read reflects on what is actually happening in our new post Covid-19 workplace.

The article was entitled: Apple Employees Form Resistance Against Company’s Return-To-Office Plans.

The labor’s public petition statement in this conflict informs us a lot about the rapidly changing US labor forces attitudes and expectations. Let me share some of their demands and  expectations – I quote:

    • This uniform mandate from senior leadership does not consider the unique demands of each job role nor the diversity of individuals,” 
    • Reasons that include “disabilities (visible or not); family care; safety, health, and environmental concerns; financial considerations; to just plain being happier and more productive.” 
    • The workers demand that Apple “allows each of us to work directly with our immediate manager to figure out what kind of flexible work arrangements are best for each of us and for Apple,”   
    • “These work arrangements should not require higher level approvals, complex procedures, or providing private information.” 
    • The employees circulating the latest petition want Apple to “encourage, not prohibit, flexible work to build a more diverse and successful company where we can feel comfortable to “think different” together.” 

This all sounds reasonable, but try to understand how management will now actually control the labor force towards being more productive. I understand that the employees believe what they are saying, but my experience is that people must be managed. By that I mean consensus only goes so far before management must make hard decisions that always alienate some – the more hard decisions being made, the more people who become alienated. In the economic world we now live in, management must make tough decisions continuously to stay competitive and highly productive. 

JPMorgan Chase CEO Jamie Dimon has been blasting working from home and Zoom as “management by Hollywood Squares. He states that his experience is: 

“Remote work creates a working environment that’s less honest and more prone to procrastination”. 

He states that: 

    •  It doesn’t work for people who want to Hustle, 
    •  It doesn’t work for Culture, 
    •  It doesn’t work for an Apprenticeship Program, 
    •  It doesn’t work for Spontaneous Stuff,  
    •  It doesn’t work for Idea Generation.  

The question is whether remote work was a temporary perk, like the ability to order to-go cocktails, or a new feature of the American workplace. If the latter is the case, then how should it be factored into an employee’s overall compensation package?

Remote, in the private sector, is perceived as a new fringe benefit. Corporate executives are presently offering remote work but are “doing it unhappily.” Younger employees who continue to eagerly seize on the opportunity to stay out of the are office oblivious to the long-term consequences of that decision. Young people are beginning to understand that their career potential is being jeopardized by not being in the office as advancement evolves from relationships, and you can’t build relationships on Zoom. You can’t become a leader.

No matter which side you come out on this conflict, it suggests lower productivity is highly likely going forward compared to past trends.


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Remote work has become one of the most contentious debates in America today. It is one that pits the future of cities against the future of work, employers against employees.

Remote work has become an entrenched practice in the last two years, but is it a truly sustainable one?

As the Washington DC Deputy Mayor recently expressed during a downtown small business opening:

    • “We don’t think all the people have to come back all the time, but we do need most of the people back most of the time!” 
    • Practically pleading he said: “We need those office folks!” 

In most major cities commercial real estate (and the financial, law firms and government offices that fill millions of square feet) constitutes the tax base. A collective flight of workers and the corporations that employ them could lead to a mass economic collapse!

No matter which side you come out on this conflict, it suggests lower productivity is highly likely going forward compared to past trends.




The longer term economic viability of our major cities is increasing in jeopardy. This is in addition to US productivity being quickly brought back inline with competitive global levels.


Democrats are finding themselves on the wrong side of their campaign contributions, state & local governments versus what Unions and city voters are demanding. “We need those office folks” as state and city officials are urging the Biden administration to end silence on remote work. Expect nothing until after the mid-term elections. 

In his State of the Union address in February, Biden described returning to the office as almost a kind of patriotic duty. He reiterated that message several days later from the White House. “Because of the progress we’ve made fighting COVID, Americans can not only get back to work, but they can go to the office and safely fill our great downtown cities again,” he said.

Offices will never again be as full as they were in early February 2020, before lockdowns forced everyone who could work from home to do so.

Hybrid is here to stay.


Hybrid remote working if properly implemented no doubt should increase productivity. However, always follow the money and here it favors politics and tax revenue versus long term corporate profitability & productivity.

Can we expect Employee Remote Work to soon be sold and classified as a taxable benefit?



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