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The result is sluggish productivity.
Combined with sluggish productivity growth, rapid wage inflation is squeezing company profits.
Inefficient industries may keep people employed in the short term, but over time their sluggish productivity makes the economy stagnate.
But many states face another grim outcome: years of low growth caused by uncompetitive exchange rates and sluggish productivity.
And he probably does not take the arguments for secular stagnation seriously enough: deteriorating demographics and sluggish productivity growth are important.
Some suggest that the unusually high productivity growth so late in an economic cycle is merely making up for sluggish productivity earlier in the 1990s.
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But now that the boom has collapsed into sluggish growth, productivity's contribution to that prosperity is uncertain.
Many Sub-Sahara African countries have long endured sluggish agricultural productivity growth and a farm structure dominated by smallholders.
Periods of weak global trade are inevitably associated with sluggish growth, stalled productivity and falling living standards.
It is now generally accepted that in around 1995, after 20 sluggish years, American productivity growth began a remarkable surge that only now seems to be subsiding.
Still, if the sluggish rates of productivity growth we've seen over the past two years were to persist into the indefinite future, it would take more than a hundred years for output-per-person and living standards to double.
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