What you're not hearing about the most important concept in economics

Productivity explains 70% of output growth historically, with the remaining minority explained by hours worked. With slowing population growth and immigration running in reverse, productivity is now more important than ever. Output growth has been in secular decline over the almost 80-year history of the data since World War Two. Hours worked have been flat, so a secular decline in productivity growth is the sole cause. Productivity growth moves in decade-plus cycles, which closely correspond to stock market performance. The pandemic lockdown in Q2-2020 marked an historic bottom in productivity growth, and launched a new upswing cycle with the single best quarter in history -- while the global economy was still locked down. We learned to do more with less, and we haven't forgotten -- we've continued to build on that amazing quarter of productivity gains. We are in a post-pandemic productivity-led boom, as we said we would be at the time, more than five years ago. Add in a technology boost from AI and we are likely still in early days.