Recent Updates
- Global Supply Chain Pressure Index (Mar, Apr)
- US: Job Openings and Labor Turnover Survey by State (Mar)
- US: New Residential Construction (Apr)
- Canada: CPI (Apr)
- Japan: NCI Economic Activity Index (May)
- more updates...
Economy in Brief
U.S. Mortgage Applications Continued to Slide Amid Higher Rates
The biggest declines have been in refinancing activity, while applications for purchase are just starting to crack...
UK Inflation Jumps
Inflation is at the highest rate since the series began in January of 1989...
U.S. Industrial Production Much Stronger than Expected in April
The increase in manufacturing output in April was once again led by motor vehicle and parts production...
U.S. Retail Sales Posted Solid Rise in April
Notwithstanding falling real incomes and declining confidence measures, consumer spending posted a solid increase...
U.S. Home Builder Index Took a Steep Drop in May
This is the fifth straight month that builder sentiment has declined...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
The Many Links of Inflation Cycle: Hard Landing Is Needed to Crack Them
Peak Inflation & Fed Policy: A Relationship Which Should Worry The Fed And Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
"Core" GDP Suggests Economy Gained Momentum in Q1:2022
by Tom Moeller February 6, 2020
Productivity in the nonfarm business sector during Q4'19 increased 1.4% (SAAR) following an unrevised 0.2% Q3 slip. The gain matched expectations in the Action Economics Forecast Survey. It raised productivity by 1.8% during the last four quarters.
Accompanying the improvement was a 2.8% (4.2% y/y) rise in compensation. It was the largest increase in three quarters and raised y/y growth to 4.2%, its quickest since Q4 2012. Adjusted for price changes, compensation rose 0.3% and a quickened 2.1% y/y. Unit labor costs increased 1.4% during Q4'19 after a 2.5% rise. A 1.1% increase was expected. The gain pulled the y/y rise to 2.4% which was the strongest gain since early-2018, up from 1.0% in Q4'18.
In the manufacturing sector, productivity declined at a 1.2% rate, off for the third straight quarter. The decline lowered factory sector productivity by 0.7% during the last four quarters, the weakest performance since Q3'17.
Compensation in the factory sector strengthened 4.6% both q/q and y/y. It was the quickest four quarter rise since Q2'09, and up from little change in 2016. Adjusted for price inflation, compensation rose 2.0% q/q and a strong 2.5% y/y. The compensation increase combined with the decline in productivity raised unit labor costs in the factory sector by 5.9%. The 5.3% y/y increase was the strongest four quarter rise in just over 10 years.
The productivity & cost figures are available in Haver's USECON database.
Productivity & Costs (SAAR, %) | Q4'19 | Q3'19 | Q2'19 | Q4'19 Y/Y | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
Nonfarm Business Sector | |||||||
Output per Hour (Productivity) | 1.4 | -0.2 | 2.5 | 1.8 | 1.7 | 1.3 | 1.3 |
Compensation per Hour | 2.8 | 2.3 | 2.5 | 4.2 | 3.8 | 3.1 | 3.5 |
Unit Labor Costs | 1.4 | 2.5 | 0.1 | 2.4 | 2.0 | 1.8 | 2.1 |
Manufacturing Sector | |||||||
Output per Hour (Productivity) | -1.2 | -0.3 | -2.4 | -0.7 | 0.0 | 0.3 | -0.5 |
Compensation per Hour | 4.6 | 3.1 | 2.6 | 4.6 | 3.8 | 2.2 | 3.5 |
Unit Labor Costs | 5.9 | 3.3 | 5.1 | 5.3 | 3.8 | 1.8 | 4.0 |