Perhaps even more importantly, a range of new technologies -- the microprocessor, the laser, fiber-optics, and satellite -- appeared in the late 1990s to be making the American economy significantly more productive than economists had thought possible. "The newest innovations, which we label information technologies, have begun to alter the manner in which we do business and create value, often in ways not readily foreseeable even five years ago," Federal Reserve Chairman Alan Greenspan said in mid-1999. Previously, lack of timely information about customers' needs and the location of raw materials forced businesses to operate with larger inventories and more workers than they otherwise would need, according to Greenspan. But as the quality of information improved, businesses could operate more efficiently. Information technologies also allowed for quicker delivery times, and they accelerated and streamlined the process of innovation. For instance, design times dropped sharply as computer modeling reduced the need for staff in architectural firms, Greenspan noted, and medical diagnoses became faster, more thorough, and more accurate. Such technological innovations apparently accounted for an unexpected surge in productivity in the late 1990s. After rising at less than a 1 percent annual rate in the early part of the decade, productivity was growing at about a 3 percent rate toward the end of the 1990s -- well ahead of what economists had expected. Higher productivity meant that businesses could grow faster without igniting inflation. Unexpectedly modest demands from workers for wage increases -- a result, possibly, of the fact that workers felt less secure about keeping their jobs in the rapidly changing economy -- also helped subdue inflationary pressures. Some economists scoffed at the notion American suddenly had developed a "new economy," one that was able to grow much faster without inflation. While there undeniably was increased global competition, they noted, many American industries remained untouched by it. And while computers clearly were changing the way Americans did business, they also were adding new layers of complexity to business operations. 98