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Economy in Brief
NABE Projects Firm Growth in 2022, as in 2021
The NABE expects 4.0% real GDP growth in 2022 following a 4.8% rise during 2021...
U.S. Construction Spending Strengthens Again in January
Building activity continues to strengthen...
Manufacturing PMIs Are Strengthening More in the Developed World
PMIs largely are improving in February...
U.S. Personal Income & Spending Surge With Stimulus Payments in January
Personal income jumped 10.0% (13.1% y/y) last month...
Chicago Business Barometer Declines Sharply in February
The ISM-Chicago Purchasing Managers Business Barometer fell 4.3 points in February to 59.5...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller June 2, 2005
Non-farm labor productivity growth about matched Consensus expectations and was revised higher to 2.9%. A surprise, however, was that compensation costs were revised up in 1Q to 6.3% and up sharply to 10.4% in 4Q04.
As a result of revisions to compensation, unit labor cost growth accelerated to 4.3% versus 1Q '04 versus an upwardly revised 0.8% during 2004.
Productivity in the nonfinancial corporate sector rose 2.7% (4.9% y/y) following 9.0% growth during 4Q '04. Compensation, however, rose 6.8% after a 10.2% 4Q rise and caused unit labor costs to rise 4.1% (2.0% y/y). The ratio of prices to unit labor costs fell to the lowest level in a year, confirming the crimp on 1Q profits.
Does Wage Inflation Cause Price Inflation? from the Federal Reserve Bank of Cleveland can be found here.
Non-farm Business Sector (SAAR) | 1Q '05 (Revised) | 1Q '05 | 4Q '04 | Y/Y | 2004 | 2003 | 2002 |
---|---|---|---|---|---|---|---|
Output per Hour | 2.9% | 2.6% | 2.3% | 2.6% | 4.0% | 4.3% | 4.3% |
Compensation | 6.3% | 4.8% | 10.2% | 7.0% | 4.8% | 4.0% | 3.2% |
Unit Labor Costs | 3.3% | 2.2% | 7.7% | 4.3% | 0.8% | -0.3% | -1.1% |