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Economy in Brief
U.S. PPI Posts Broad-Based Strength in March
The Producer Price Index for final demand jumped 1.0% (4.2% y/y) during March...
U.S. Wholesale Inventories Post Strong February Gain; Sales Fall
Wholesale inventories increased 0.6% (2.0% y/y) during February...
U.S. Initial Unemployment Insurance Claims Unexpectedly Increase
Initial claims for unemployment insurance rose to 744,000 during the week ended April 3...
Total PMIs Gain Traction in March
The PMI readings for March show improvement again...
U.S. Consumer Credit Outstanding Bounces Back in February
Consumer credit outstanding surged $27.6 billion during February...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Monetary Policy Blunder: Not Managing Economic & Financial Outcomes Equally
Monetary Policy at a Crossroad: Policymakers Need to Break Promise of Easy Money to Avoid Boom-Bust
State Coincident Indexes in January
Data Surprises, Markets and COVID
by Tom Moeller March 5, 2020
Productivity in the nonfarm business sector during Q4'19 increased 1.2% (SAAR), close to expectations, after a little-changed 0.3% Q3 decline. The Q4 gain was revised from 1.4%. Earlier figures also were revised. The latest increase raised productivity by 1.8% during the last four quarters. Output rose 2.4% (2.6% y/y) while hours-worked increased 1.2% (0.8% y/y).
Compensation increased 2.1% (3.5% y/y), revised from 2.8%. It followed a 0.1% easing during Q3, revised from +2.3%.. Adjusted for price changes, compensation rose 0.4% (1.1% y/y). Unit labor costs increased 0.9% during Q4, revised from 1.4%. Third quarter growth of 0.2% was revised from 2.5%. A 1.4% increase was expected. The gain left the y/y rise steady at 1.7%.
In the manufacturing sector, productivity declined at a 0.8% annual rate, off for the third straight quarter. It was revised from -1.2%. The decline lowered factory sector productivity by 0.6% during the last four quarters, the weakest performance since Q3'17. Output eased 0.4% (-1.1% y/y) while hours worked edged 0.4% higher (-0.5% y/y.
Compensation in the factory sector strengthened 2.8%, revised from 4.6%. During the last four quarters, compensation rose 3.1%. Adjusted for price inflation, compensation edged 0.4% higher q/q and a lessened 1.1% y/y. The compensation increase, combined with the decline in productivity, raised unit labor costs in the factory sector by 3.6% (3.7% y/y).
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) | 1.2 | -0.3 | 2.6 | 1.8 | 1.9 | 1.4 | 1.3 |
Compensation per Hour | 2.1 | -0.1 | 2.7 | 3.5 | 3.6 | 3.2 | 3.5 |
Unit Labor Costs | 0.9 | 0.2 | 0.1 | 1.7 | 2.0 | 1.8 | 2.1 |
Manufacturing Sector | |||||||
Output per Hour (Productivity) | -0.8 | -0.5 | -2.3 | -0.6 | 0.1 | 0.4 | -0.4 |
Compensation per Hour | 2.8 | -1.2 | 2.8 | 3.1 | 3.2 | 2.2 | 3.6 |
Unit Labor Costs | 3.6 | -0.7 | 5.2 | 3.7 | 3.1 | 1.8 | 4.0 |