Can productivity be raised too far.

Is high productivity ever a problem?

Well, it depends on how you look at it and the context/situation you are considering/measuring.

For example, it is possible, by applying productivity improvement to one part of a process or sequence of activities, to create a bottleneck where the throughput of the target activity is greater than the productivity of the activities of the other parts of the process.

So, productivity needs to be optimised for the whole process, not maximised for any one part of it.