Doing more with less?

        You're not alone. Struggling to recover from the 2001 recession, U.S. companies are having to ramp up production without being able to hire more workers.

        And that translated into the largest jump in productivity in 19 years during the first quarter. The Labor Department last week reported that productivity — the amount of output per hour of work — soared at an 8.6-percent annual rate January through March.

INFOGRAPHIC

• Cincinnati Business Indicators

        “Manufacturers have been forced to squeeze out productivity gains wherever they can be found,” said Gary Conley, president of TechSolve, the Bond Hill manufacturing assistance organization (formerly called the Institute for Advanced Manufacturing Sciences).

        Productivity is roughly calculated by dividing the value of goods and services produced by the number of hours taken to produce them.

        The Labor Department's number measures productivity in all areas of the economy manufacturing and services. But most of the gains have come in manufacturing. During the first quarter, factories' productivity jumped 9.7 percent.

        Part of the reason is because manufacturing has seen the largest employment drops. The sheer math behind the calculation means that if output does not drop but workers' hours fall, productivity rises.

        “Productivity is going up, but hiring isn't going up as much, so that's generating some productivity gains,” said Charlie Wright, owner of Wright Brothers Inc., a Tristate industrial gas and outdoor exercise business.

        Mr. Wright also is chairman of the Greater Cincinnati Report on Business, a monthly survey sponsored by the Cincinnati chapter of the National Association of Purchasing Management. While the NAPM report doesn't explicitly measure local productivity, it does show that output rose in April for the third month in a row. With local employment still unchanged, productivity in Greater Cincinnati has to have jumped, he said.

        Besides job cutbacks, though, productivity gains come from companies changing the way they do business, Mr. Conley said. Smarter business practices — from shortening the walking distance between two crucial departments to eliminating wasteful bureaucratic process — are allowing companies to do more with less.

        “It's doing things just a bit smarter,” he said. “When it's all added together, it has dramatic changes.”

        Dixie Thomas has seen dramatic changes at the company she co-owns in West Chester. T&S Education still makes biology and chemistry kits — but it's doing it more efficiently than it has in years.

        In the last year, the company, which operates as Kemtec Educational Corp., cut its staff size in half. Then it rearranged the way it put the kits together, such as doing the tedious package-filling procedures during slower times.

        “It was a move toward efficiency and productivity,” she said. “And we can see a big difference.”

Fed to end discount rate break
Companies doing more with less
Federated chief rebuts prognosis
Fingerhut sale still possible
Peoples Bank names chairman
Procter leaving Chemed
Ex-employees note Baldwin anniversary
Lebanon Plastics sold to Michigan firm
Demand for U.S. goods offsets high price of oil
Duncan: 'Destroy' was never said
Fast-food giant now known as Yum
HIGGINS: Personal Finance
Portman to talk on retirement legislation
Rate report
Savvy Strategies
Business Digest
Tristate Summary
What's the Buzz?