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COMMENTARY: Workers compensation reductions can be unplanned benefit


Safety seen as byproduct of efficiency

Economists do not always rely on econometric models and other sophisticated mathematical calculations to explain the world as they see it.

Sometimes things just happen that make it look as if they do.

My friend Harry Shuford, chief economist for workers compensation ratings organization NCCI Holdings Inc., has a “just-in-time Christmas popcorn” theory that helps explain how employers' efficiency improvements have contributed to making workplaces across the country safer and therefore leading to declines in workers compensation frequency.

The Christmas popcorn theory was born from discussions with a major U.S. retailer that sells large cans of the crunchy snack around certain holidays, Mr. Shuford said.

The retailer used to receive shipments of the large popcorn cans, placing some on its store shelves for customers to carry away and leaving the remainder in backroom storage until the shelves needed restocking. But with its current just-in-time process, the retailer now moves the popcorn cans directly from its loading docks to the shelves. That eliminates a certain amount of worker lifting and handling that requires the use of potentially dangerous equipment, such as ladders and forklifts.

“My point is that they didn't do that to make the workplace safer,” Mr. Shuford said. “They did that to reduce the number of times their workers had to handle merchandise. But it did make it safer.”

Something similar happened with the retailer's dog food sales.

The grocer noticed that shoppers were buying the dog food 24 cans at a time, even though the retailer did not sell it by the 24-can case. So to accommodate customers, the retailer eliminated shelving on its dog food isles. Now when a truck arrives at its stores, pallets of the dog food are placed directly on store floors where shoppers haul away the preferred cases. That eliminates worker kneeling and bending required to stock shelves while opening carton cases with potentially dangerous box cutters.

“Again, it's not to make the workplace safer,” Mr. Shuford said. “It's to address a customer need and reduce the amount of time” employees must spend handling the product, “but it makes it safer.”

The same has happened with the retailer's process for speeding things up at the checkout counter. This particular retailer has carousels of plastic grocery bags sitting atop its checkout counters. The system allows the customer to load their filled shopping bags into their cart on their own. The cashier doesn't perform that task and can remain focused on speedily ringing up the goods being purchased.

The process was conceived to speed up customer checkout, not to make the workplace safer. But it also eliminates potentially troublesome repetitive motions required of the checkout clerk, such as lifting bags and handing them to customers.

All economics lessons should be so easy to grasp.