New Arrivals?

By now, you're well-acquainted with the phrase "joblessrecovery," a term created during the slowdown of the early1990s. But today's jobless recovery is different from the lastone. The U.S. economy has lost at least 2.1 million jobs since2001, but companies keep showing incredible gains in employeeoutput-an anomaly, since productivity has traditionallydecreased in slow times. Consider this: In the third quarter of1993, nonfarm output per hour clocked in at 1.5 percent, accordingto the Bureau of Labor Statistics. By the third quarter of 2003,nonfarm output per hour was a staggering 8.1 percent.

Companies are finding they can increase productivity quarterover quarter without adding new employees or, as used to happenduring past slowdowns, by rehiring the people they've laid off.Midsize and large companies are focusing more than ever on workforce cost management, measuring the bang for the buck of everyemployee, says Jay Doherty, principal for Mercer Human ResourceConsulting LLC in New York City and co-author of Play to Your Strengths: Managing Your InternalLabor Markets for Lasting Competitive Advantage(McGraw-Hill). "There are no more easy cost reductions,"he says. "Now it's [about] value."