Productivity Gains Expected To Slow

Problems as broad as a scarcity of skilled workers and as specific as the Year 2000 computer bug threaten to dampen the productivity growth enjoyed by American workers and businesses during the past two years.

Judged by recent standards, the productivity advances in 1997 and 1996, 1.7 percent and 1.9 percent, respectively, have been pretty good.

Analysts credit efficiency-enhancing gizmos such as computers and cell phones for the improvement.

But short-term problems could dampen future gains.

A hint of the likely trend surfaced Tuesday in the Labor Department’s revised estimate for fourth-quarter nonfarm productivity. It grew at a 1.6 percent annual rate, down from the initial 2 percent estimate and less than half the rapid 3.6 percent rate in the third quarter.

Over the next year or two, productivity growth should average closer to 1 percent rather than nearly 2 percent, economists said.