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Economy in Brief

U.S. Worker Productivity Recovers Slightly
by Tom Moeller  May 2, 2013

Nonfarm business sector productivity during Q1'13 rose 0.7% (SAAR). That was a rebound from the 1.7% decline during Q4'12. That left the y/y gain of 0.9% on a par with the slow growth rates of 2011 and 2012. Real output rose at a 2.5% rate (2.5% y/y) while hours worked rose 1.8% (1.5% y/y). Improved productivity growth last quarter was accompanied by a lessened 1.2% rise (1.6% y/y) in compensation per hour. This combination of improved productivity and lower compensation caused unit labor costs to nudge up at a 0.5% annual rate (0.6% y/y) in Q1'13. That followed a 4.4% Q4 surge.

The productivity picture continued to be encouraging in the factory sector. The 3.8% quarterly gain left the y/y increase at 1.7% which also was on a par with the prior two years. Output rose 5.6% (2.6% y/y) while hours worked increased 1.7% (0.9% y/y). Compensation growth accelerated to 3.3% (3.3% y/y). The improved gain productivity lowered factory sector unit labor costs by 0.5% (+1.6% y/y).

The productivity & cost figures are available in Haver's USECON database. 

Productivity & Costs (SAAR,%) Q1'13 Q4'12 Q3'12 Q1 Y/Y 2012 2011 2010
Nonfarm Business Sector
Output per Hour (Productivity) 0.7 -1.7 3.1 0.9 0.7 0.6 3.1
Compensation per Hour 1.2 2.7 1.2 1.6 1.4 2.6 2.1
Unit Labor Costs 0.5 4.4 -1.9 0.6 0.7 2.0 -1.0
Manufacturing Sector
Output per Hour 3.8 2.2 -0.3 1.7 1.9 1.4 6.4
Compensation per Hour 3.3 0.4 0.6 3.3 2.2 2.8 1.1
Unit Labor Costs -0.5 -1.8 0.8 1.6 0.3 1.4 -5.0
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