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ECONOMY: Out of Steam; A dip in U.S. productivity provokes anxious questions. The biggest: does it signal the end of the global boom?

Newsweek International

| February 21, 2005 | COPYRIGHT 2005 Newsweek, Inc. All rights reserved. Any reuse, distribution or alteration without express written permission of Newsweek is prohibited. For permission: www.newsweek.com. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

Byline: Karen Lowry Miller

By all accounts, the new economy died three or four years ago. Business cycles do exist. Share prices can fall. Companies eventually have to make money. Bubbles burst. But one aspect of the roaring '90s survived and, indeed, thrived. Investment in new technology helped America produce twice as much per hour worked as it had in the previous quarter century. Productivity grew, on average, 1.5 percent annually from 1973 to 1995. It leaped to 2.5 percent in the second half of the '90s and continued to climb even after the boom ended in 2000. IT spending ground to a halt, but productivity rose a staggering annual 4.3 percent between 2001 and ...

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