Essay: The USA has one of the highest labor productivity rates in the world - significantly higher than both China and Russia

In terms of the quality of its labor, the U.S. labor market is in line with those of other developed countries.[1] See: America’s Labor Productivity Sets it Apart, TD Bank April 2024
In 2023, the USA was over 200% more productive in terms of labor productivity than Russia when measured using purchasing power parity.[2][3] In 2023, the USA was over 400% more productive in terms of labor productivity than China when measured using purchasing power parity.[4][5]
The United States is a high-income economy.[6] A high-income economy is defined by the World Bank as a country that has a gross national income per capita of US$13,845 or more in 2022 that is calculated using the Atlas method (The Atlas method, employed by the World Bank since 1993, is used to approximate the economic size of nations in terms of their gross national income (GNI) in U.S. dollars.).[7] China and Russia are upper middle-income countries.[8][9]
According to Yahoo Finance: "Efficiency in production, also coined as productivity, is one of the major driving forces behind economic resilience in a country... The United States has one of the strongest economies in the world. The country hosts some of the largest companies in the world, which contributes to the high GDP per capita in the country. In 2022, the United States recorded a GDP per capita of $76,399."[10]
Investopedia says about the importance of labor productivity to an economy, "Labor productivity is largely driven by investment in capital, technological progress, and human capital development. Labor productivity is directly linked to improved standards of living in the form of higher consumption. As an economy's labor productivity grows, it produces more goods and services for the same amount of relative work. This increase in output makes it possible to consume more of the goods and services for an increasingly reasonable price."[11]
As can be seen in the map below of labor productivity in the world by country in 2024, the USA has significantly higher labor productivity than both China and Russia and it has one of the highest labor productivity rates in the world in 2024.[12]
According to Investopedia: "Education tends to raise productivity and creativity, as well as stimulate entrepreneurship and technological breakthroughs. All of these factors lead to greater output and economic growth."[13] In 2023, as part of a trend of a growing school choice movement in the United States (particularly post conavirus pandemic), 20 states in the United States passed school choice legislation which has the potential to raise the quality of education in the United States due to more competition in schooling raising the quality of the education.[14]

According the Yahoo Finance: "According to Yahoo Finance: "Efficiency in production, also coined as productivity, is one of the major driving forces behind economic resilience in a country... The United States has one of the strongest economies in the world. The country hosts some of the largest companies in the world, which contributes to the high GDP per capita in the country."[16]
As can be seen in the map above, the USA has one of the highest labor productivity rates in the world and it is significantly higher than both China and Russia.[17]

Contents
- 1 The United States and innovation
- 2 Articles on the USA's labor productivity
- 3 2017: USA was the highest ranking country on the Intelligence Capital Index
- 4 The strength of the United States economy
- 5 Why are some countries more productive than others?
- 6 The genius of the founding fathers of the United States, happiness and labor productivity
- 7 China's labor productivity from 1953 to 2023
- 8 Russia and labor productivity
- 9 List of countries by labor productivity (Ranked using purchasing power parity)
- 10 Other essays by User: Conservative
- 11 References
The United States and innovation
See also: United States and innovation
The United States is a leader in technology and innovation.

Articles on the USA's labor productivity
- US Productivity Increases at Rapid Pace, Cementing 2023 Rebound, Bloomberg Law, 2024
- Looking at the Growing Productivity of American Workers for Labor Day, US Bureau of Labor Statistics, August 2023
Fortune magazine, September 2023: Top USA economist says he sees artificial intelligence doubling USA's productivity in the next 10 years
- A top economist who studies AI says it will double U.S. productivity in the next decade: ‘You need to embrace this technology and not resist it’, Fortune magazine, September 2023
2017: USA was the highest ranking country on the Intelligence Capital Index
In 2017, the USA was the highest ranking country on the Intelligence Capital Index (ICI).[23][24] The ICI was developed to measure which nations are most likely to foster the big ideas of tomorrow (It looks at factors such as education, creativity, various cognitive skills, and the ability to attract top talent around the world via immigration).[25][26]
The strength of the United States economy

On October 17, 2024, The Economist stated concerning the United States:
“ | Over the past three decades America has left the rest of the rich world in the dust. In 1990 it accounted for about two-fifths of the GDP of the G7. Today it makes up half. Output per person is now about 30% higher than in western Europe and Canada, and 60% higher than in Japan—gaps that have roughly doubled since 1990. Mississippi may be America’s poorest state, but its hard-working residents earn, on average, more than Brits, Canadians or Germans. Lately, China too has gone backwards. Having closed in rapidly on America in the years before the pandemic, its nominal GDP has slipped from about three-quarters of America’s in 2021 to two-thirds today.[27] | ” |
For more information, please read:
Why are some countries more productive than others?
The genius of the founding fathers of the United States, happiness and labor productivity
See: The genius of the founding fathers of the United States, happiness and labor productivity
China's labor productivity from 1953 to 2023
Michael Beckley is an associate professor of political science at Tufts University and a Jeane Kirkpatrick Visiting Scholar at the American Enterprise Institute Beckley published the 2018 book Unrivaled: Why America Will Remain the World's Sole Superpower.
A Rand Corporation review of Beckley's book Unrivaled: Why America Will Remain the World's Sole Superpower indicates:
“ | Beckley adduces an impressive amount and diversity of evidence in support of his argument. U.S. workers, for example, “generate roughly seven times the output of Chinese workers on average.” China's total factor productivity growth rate, meanwhile, “has actually turned negative in recent years, meaning that China is producing less output per unit of input each year,” and “roughly one-third of China's industrial production [goes] to waste.”[28] | ” |
The Stanford Center on China's Economy and Institutions article Invisible China: Hundreds of Millions of Rural Underemployed May Slow China’s Growth indicates: "The share of uneducated workers in China's labor force is larger than that of virtually all middle-income countries. According to census data, there are roughly 500 million people in China between the ages of 18 and 65 without a high school degree."[29]

Russia and labor productivity
See also: Essay: Low labor productivity is one of the most acute and important problems facing Russia
According to the Moscow Times:
“ | During his annual phone-in with the public in June this year, President Vladimir Putin described low productivity as “one of the most acute and important” problems facing Russia.
Economists agree. Russia is one of the least productive moderately rich countries in the world, ranking 39th out of the 42 monitored by the Organisation for Economic Cooperation and Development (OECD). In cash terms, Russia produces $24.61 in GDP for every hour worked, half the $48.15 OECD average. “Boosting productivity is key to increasing Russia’s GDP growth,” said Jakob Suwalski, lead analyst at Scope Ratings. “However, meeting the challenge is easier said than done.” Productivity is one of the most-watched indicators of an economy’s long-term prospects, measuring how much GDP is produced for every hour worked. As Putin highlighted, higher productivity means higher wages, since the more value workers create, the more they can be paid. The latest Russian attempt to solve its low productivity problem is its ambitious National Projects public spending program. Alongside a string of new infrastructure construction, the state has promised to throw 52 billion rubles ($800 million) worth of cheap loans, export promotion and training courses specifically at the productivity issue. But economists point to a cocktail of “state capitalism,” corruption, low investment, poor equipment and unfavorable demographics to explain Russia’s malaise — drawbacks the $1-per-person-per-year government scheme will struggle to address.[32] |
” |
On February 7, 2024, Reuters reported:
“ | According to Rosstat, Russia's labour productivity index, one of Putin's key national development goals, fell 3.6% year-on-year in 2022, its steepest annual fall since the aftermath of the global financial crisis in 2009.
Labour Minister Anton Kotyakov has said Russia needs to increase labour productivity in order to become more technologically self-sufficient. Labour productivity data for 2023 will not be published until late-2024, but the authorities' warnings about manpower shortages suggest there was no rebound in that figure last year.[33] |
” |

Other factors dampening Russia's labor productivity rate

In 2018, the Organisation for Economic Co-operation and Development (OECD) states concerning Russia's low labor productivity:
“ | Labour productivity is a key precondition for high growth of output, employment and wages and central to long-term growth in living standards...
Earnings quality is close to the bottom of OECD countries, partly due to low labour productivity resulting from a low capital stock in the economy. More than 30% of workers face high job demands with few job resources to meet these demands... Sanctions and other import barriers have hampered technology transfers from abroad. A poor business climate, in particular weak property rights, impedes innovation.[35] |
” |
The University of Birmingham reported in 2022:
“ | The World Intellectual Property Organisation publishes a Global Innovation Index based on an assessment of national innovation inputs and outputs. In 2021, Russia was ranked in 45th place after Vietnam and Thailand, with the United States being third and the UK fourth in the ranking. Russia’s ranking highlights that Russia is a low-tech nation.
Russia's position in the Global Innovation Index is partly explained by the country's failure to invest in research and development (R&D). In 2019, the US spent 3.1% of the country's gross domestic product (GDP) on R&D whilst Russia spent 1%. This can be calculated based on R&D expenditure per capita and for the US this was $1,866 compared to Russia’s expenditure of $263. It is estimated that Russia is spending $900 million a day on the Ukraine war. Russia, calculates the return on this investment in terms of territory but much greater economic and political returns would come from investing in R&D.[36] |
” |
The article Russian Power in Decline indicates:
“ | Russia’s “high education, low human capital” paradox does not end with problematic health: it shows up acutely in the country’s “knowledge production” deficit, too. Nowadays, long-term economic progress depends critically on improving productivity through knowledge — technology, management and so on — rather than through the accumulation of physical capital. But, oddly for a well-educated, mediumhigh- income country, Russia is terrible at it.
The U.S. Patent Office (now known as the Patent and Trade Office, or PTO) was established in the 1830s. But nearly half of its patent awards and well over half of its awards to foreign inventers have been granted just since the year 2000. Of the 2.5 million patents awarded to foreigners between 2000 and 2020, applicants from Russia took home fewer than 6,600 — which was a smaller fraction of the total than had been awarded to the USSR during the Cold War. In the 2002-2020 period, Russia (with the world’s ninth-largest population) ranked 25th in PTO awards, behind tiny Norway and Finland. Wait, this gets better — I mean worse. The Russian Federation’s rate of PTO awards is currently on a par with the state of Alabama. But Alabama’s population is just 5 million — while Russia’s is over 140 million, very nearly 30 times larger. The contrast with high-tech California is truly remarkable. Russia’s population is over three and a half times larger, while in 2020 California produced over 80 times more patents — that’s total, not per capita. Another way to look at Russia’s underperformance in patents is to compare patent activity with educational attainment. Belgium’s 2020 “yield” of international patent applications per person with some college attendance was 15 times higher than Russia’s, while Austria’s was 23 times higher. By this reckoning, over 50 countries — not just Western countries and China, but Saudi Arabia and South Africa — came out ahead of Russia. This underperformance is reflected in foreign trade. In 2019, Russia’s share of global economic output adjusted for purchasing power was 3.1 percent. Yet Russia generated only 1 percent of total global service-sector exports. Note that service exports really amount to trade in human skills — unlike merchandise trade, which is in commodities or natural resources and thus generally less skills-intensive. Curiously, given Russia’s wellknown expertise in software, it even fares poorly in IT exports, where its 2019 share of the global market was only slightly ahead of the Philippines. Adding to the shortfall, the Ukraine invasion seems to be affecting the talent base for what there is of a knowledge economy. In the initial weeks of the war, some estimated that as many as 200,000 highly skilled Russians fled their country — many of them IT specialists. Depending on the course of that war and on Western sanctions, the bleed of talent may or may not be staunched when the guns fall silent. But it is difficult to envision a scenario in which Russia ever becomes a magnet for the best and brightest.[37] |
” |
In 2023, MIT Technology Review stated in its article How Russia killed its tech industry:
“ | In the months after the invasion began, Russia saw a mass exodus of IT workers. According to government figures, about 100,000 IT specialists left Russia in 2022, or some 10% of the tech workforce—a number that is likely an underestimate. Alongside those exits, more than 1,000 foreign firms curtailed their operations in the country, driven in part by the broadest sanctions ever to be imposed on a major economy.
It has now been over a year since the full-scale invasion of Ukraine began, with more than 8,300 recorded civilian deaths and counting. The tech workers who left everything behind to flee Russia warn that the country is well on its way to becoming a village: cut off from the global tech industry, research, funding, scientific exchanges, and critical components. Meanwhile Yandex, one of its biggest tech successes, has begun fragmenting, selling off lucrative businesses to VKontakte (VK), a competitor controlled by state-owned companies.[38] |
” |
Stratfor reported in 2015:
“ | Russian innovation seems poised to continue its gradual decline into obsolescence through neglect. Even if Russia's economy were healthy, it would be an uphill struggle for Russian research and development because of the difficulty of attracting and maintaining talent.
One recent event could very well be marked by history as the proverbial nail in the coffin of Russian research: Dmitry Zimin's Dynasty Foundation was deemed a foreign agent on May 26. Zimin left the country by June 5, and it is uncertain when he will return. The oligarch has long been a supporter, if not the banner carrier, of innovation within Russia. He developed telecommunications firm VimpelCom before the fall of the Soviet Union and brought modernity to Russia during and after the collapse. Zimin was seen as one of the last vestiges still capable of attracting thinkers to the country. Although he has typically held opposing views with Russian President Vladimir Putin, Zimin previously had remained unscathed by Kremlin political upheaval.[39] |
” |

Russian Federation ranks 7th among the 33 upper-middle income group economies.[42][43]
Russian Federation ranks 31st among the 39 economies in Europe.[44][45]
For more information, please see:
*Global Innovation Index 2023 - Russia
*Global Innovation Index 2023. Innovation in the face of uncertainty
Russia's unfriendly business environment and low labor productivity
The Kennan Indicates concerning Russia's unfriendly business environment:
“ | Albats suggested that democracy should be viewed as a commodity that needs to have buyers. In order for democracy to develop in Russia, there must be a class of "consumers of democratic politics," consisting primarily of people involved in small and medium businesses. Unfortunately, Albats warned, this constituency is in decline in Russia. The number of people employed in small and medium business has declined from a peak of 8.9 million in 1995 to only 6.3 million in 2001. At the same time, the proportion of bureaucrats relative to the population has been increasing: In the last days of the Soviet Union, there was one bureaucrat for every 75.6 citizens, and in Russia today there is one bureaucrat for every 49.6 citizens.
Thriving in a system rife with corruption and little accountability, Soviet-trained bureaucrats have stifled the growth of small businesses in Russia, according to Albats. She noted that the majority of regulations existing in Russia today were issued not by the Duma or the President, but by various state agencies—between 1991 and 2001, Russian federal ministries imposed 1474 regulations on business, compared with 156 passed by the legislature. Albats contended that bureaucrats find it easier to control several large businesses than many small businesses, and have set up a regulatory framework to reflect that preference.[46] |
” |
Many small businesses work in their businesses and Russian small and medium business people are burdened with a lot of pointless regulations to deal with.
See also: Vladimir Putin is a corrupt kleptocrat and an authoritarian
Russia's economy is that of a shrinking, aging, and poorly qualified population
See also: Russia's economy is that of a shrinking, aging, and poorly qualified population
On December 15, 2023, The Insider noted:
“ | The nationwide mobilization (and the resulting outflux of qualified professionals abroad) exacerbated the crisis in the Russian labor market, already profoundly affected by the demographic decline. Russia's workforce shortage will only increase, experts warn, and may reach 4 million people by 2030. Developed economies compensate for insufficient human resources by driving labor productivity (using such tools as AI, among others), but Russia is also faced with the degradation of industrial processes due to international sanctions. Igor Lipsits, Doctor of Economics, explains how Russia's government policy has caused a labor market catastrophe and why the deteriorating educational system cannot remedy the situation...
As early as 15 years ago, when the 2020 Strategy was in the making, the debate was ongoing as to whether defense spending should be cut in favor of supporting education to prevent its decay. No practical steps were taken, though, and Russia currently ranks 82nd in the world by education spending... Since 2006, Russia’s working-age population has shrunk by 13 million. That is, this category is going through a rapid decline. The resulting workforce shortage will cost Russia 1-2% of its GDP each year, according to a market study by Yakov & Partners (former partners of McKinsey in Russia)... From 2018 to 2023, the number of vacancies in Russia has grown by 80%, exacerbating the shortage of human resources. By 2030, the gap will have reached 2–4 million employees. The most affected category is professionals with vocational training (1.1–2.2 million people). The shortage of specialists with a high education will vary from 700,000 to 1.4 million. Russia is not the only nation facing depopulation. Japan, which has it the hardest, has chosen to remedy the situation through robotic engineering. By contrast, Russia is among the planet's laggards in terms of production automation, with its robotic automation pace equaling one-seventieth of the global average... According to the Center for Education Quality Assessment under Russia’s Ministry of Education, around 10% of Russia's schools offer subpar tuition. That’s an optimistic assessment, considering that testing has revealed 22% of Russia's secondary school students to be low-performing. They struggle to grasp the meaning of texts and cannot objectively assess themselves. What further education path is available to such students? Sixty-six percent enter various vocational schools, 26% go to high school anyway, and 7% call it quits. They often consider joining the military as a viable option, ending up in the war with Ukraine, in which Russia is losing both its population and genetic pool. As a result, 25-28% of Russia's adult population is more of a burden to the nation, only preventing its economic development... The quality of schooling has grown even poorer, with Russian schools ranking 31st–33rd among 79 countries, according to 2018 PISA tests in several fields. In 2022, Russia didn't participate in the study due to the war. The quality of higher education, including the PhD level, has also dropped. Thus, from 2010 to 2021, the number of colleges offering postgraduate programs dropped by 3.4 times; the number of available Ph.D. positions decreased by 1.9 times; the Ph.D. graduation rate plunged by 2.4 times, and the number of Ph.D. students who graduated by defending a thesis fell even lower, by 6.4 times.[47] |
” |
The Insider further noted:
“ | According to pre-war data by the Russian Association of Robotics (today's indicators are likely even lower), annual sales of industrial robots in Russia didn't exceed 2,300 pieces, whereas Japan sold as many as 38,000 with a much smaller population. Russia ranks even lower than Mexico and Thailand. At the end of the day, Russia is both losing human resources and failing to replace them with robots; as its population is shrinking, so is the share of young workers capable of amassing human capital.
Demographic forecasts suggest that by 2031, the share of the most productive workers aged 20-39 will have shrunk by 25% compared to 2020. Even by 2035, this indicator won't have rebounded to its 2020 level. As a result, Russia's economy is that of a shrinking, aging, and poorly qualified population.[49] |
” |
Articles and videos on Russia's labor shortages
Videos:
- Russia faces record labour shortage, TRT World, 2024 (Turkish news company)
- Russia's War Economy: A Labor Crisis Unfolding, 2024
List of countries by labor productivity (Ranked using purchasing power parity)
In 2023, the USA was over 200% more productive in terms of labor productivity than Russia when measured using purchasing power parity.[50][51]
In 2023, the USA was over 400% more productive in terms of labor productivity than China when measured using purchasing power parity.[52][53]
(An international dollar would buy in the cited country a comparable amount of goods and services a U.S. dollar would buy in the United States. This term is often used in conjunction with Purchasing Power Parity (PPP) data.[54])
Other essays by User: Conservative
The United States
- The United States will be the leading power in the world for the foreseeable future
- Why the USA's per capita income is MUCH higher than Russia's
- Is the USA an economic powerhouse and juggernaut?
- Size of a working age population in a country and its correlation with national GNP in advanced economies. The ability of the United States to attract some of the best and brightest workers in the world
- Top 12 reasons why people are flocking to the USA and leaving the corrupt, authoritarian countries of China and Russia
- Isolationalism is growing in the United States. Is this a good thing?
- The USA is outproducing Russia and Saudi Arabia in oil production. The best is yet to come
- The USA can reduce its national debt. It has done it before
- The citizens of the United States are happier than the citizens of Russia and China. USA! USA! USA!
- The U.S. Navy is the most powerful navy in the world
- Gold reserves by country. The USA is still golden!
- The USA will become bigger, better and stronger than ever before! Russia and China will not! USA! USA! USA! - Humor

See: The United States will be the leading power in the world for the foreseeable future
References
- ↑ United States - Strengths and weaknesses
- ↑ Statistics on Labour Productivity, International Labor Organization website
- ↑ List of countries by labor productivity (Ranked using purchasing power parity)
- ↑ Statistics on Labour Productivity, International Labor Organization website
- ↑ List of countries by labor productivity (Ranked using purchasing power parity)
- ↑ World Bank high-income economy
- ↑ Country and Lending Groups. World Bank. Accessed 2023.
- ↑ [The World Bank In China], World Bank
- ↑ Russian Federation, World Bank
- ↑ 25 Most Productive Countries Per Capita, Yahoo Finance
- ↑ Labor Productivity: What It Is, How to Calculate & Improve It, Investopedia
- ↑ Most Productive Countries 2024
- ↑ How Education and Training Affect the Economy
- ↑ Twenty states passed school choice programs last year. Why haven’t these red states?, Washington Examiner, 2024
- ↑ Labor Productivity: What It Is, How to Calculate & Improve It, Investopedia
- ↑ 25 Most Productive Countries Per Capita, Yahoo Finance
- ↑ Most Productive Countries 2024
- ↑ USA Nonfarm labor productivity 1947 to 2024
- ↑ The U.S. Is (Again) Among the World's Top Innovators, U.S. News and World Report, 2023
- ↑ Global Innovation Index 2023: Switzerland, Sweden and the U.S. lead the Global Innovation Ranking; Innovation Robust but Startup Funding Increasingly Uncertain
- ↑ World's Most Innovative Countries, Statista website, 2023
- ↑ Ranked: The Most Innovative Countries in 2023
- ↑ Intelligence Capital Index
- ↑ The World's Smartest Countries
- ↑ The World's Smartest Countries
- ↑ Intelligence Capital Index
- ↑ [America’s economy is bigger and better than ever], The Economist, 2024
- ↑ Book Review: 'Unrivaled' by Michael Beckley, Rand Corporation
- ↑ Invisible China: Hundreds of Millions of Rural Underemployed May Slow China’s Growth., Stanford Center on China's Economy and Institutions
- ↑ China's labor productivity growth from 1953 to 2022, Source: www.ceicdata.com
- ↑ Why Is Russia So Unproductive?, Moscow Times, 2019
- ↑ Why Is Russia So Unproductive?, Moscow Times, 2019
- ↑ Russia's GDP boost from military spending belies wider economic woes, Reuters, February 7, 2024
- ↑ Labour Productivity Growth,Source: CEICADATA.com
- ↑ [How does Russia compare?], Organisation for Economic Co-operation and Development
- ↑ Russia as a low-tech nation - severing the country from global supply chains with the Ukrainian war, University of Birmingham
- ↑ Russian Power in Decline by Nicholas Eberstadt, August 2022
- ↑ How Russia killed its tech industry, MIT Technology Review
- ↑ The Decline of Russian Innovation, Stratfor, 2015
- ↑ Global Innovation Index 2023. Innovation in the face of uncertainty
- ↑ Global Innovation Index 2023
- ↑ Global Innovation Index 2023. Innovation in the face of uncertainty
- ↑ Global Innovation Index 2023 - Russia
- ↑ Global Innovation Index 2023. Innovation in the face of uncertainty
- ↑ Global Innovation Index 2023 - Russia
- ↑ [Bureaucrats and Russian Transition: The Politics of Accommodation]
- ↑ The “no human” factor: How Russia’s workforce shortage rolls back its economic development
- ↑ The “no human” factor: How Russia’s workforce shortage rolls back its economic development
- ↑ The “no human” factor: How Russia’s workforce shortage rolls back its economic development
- ↑ Statistics on Labour Productivity, International Labor Organization website
- ↑ List of countries by labor productivity (Ranked using purchasing power parity)
- ↑ Statistics on Labour Productivity, International Labor Organization website
- ↑ List of countries by labor productivity (Ranked using purchasing power parity)
- ↑ What is an international dollar, World Bank