Labor productivity rises during a recession as firms retain their more experienced workers.

Question

Quizplus · Accepted Answer

During a recession, labor productivity usually decreases due to factors such as decreased demand and layoffs reducing morale and experience within the workforce. Retaining more experienced workers may help prevent productivity from declining as much as it otherwise would, but it generally does not lead to a rise in productivity.

Labor Productivity Rises During a Recession as Firms Retain Their