Global| Dec 03 20093Q U.S. Worker Productivity Strength Revised Lower & Unit Costs Up
by:Tom Moeller
|in:Economy in Brief
Summary
Last quarter's strength in productivity growth was revised lower with the reduced reading on GDP. Nevertheless, the revised 8.1% jump remained the strongest since 3Q '03 and fell just short of Consensus expectations for an 8.5% [...]
Last quarter's strength in productivity growth was revised lower with the reduced reading on GDP. Nevertheless, the revised 8.1% jump remained the strongest since 3Q '03 and fell just short of Consensus expectations for an 8.5% increase.">
The revision reflected a downwardly revised 2.9% (-3.7% y/y) increase in output. Hours-worked (employment times hours) was little-revised at down 4.8% (-7.4% y/y) which followed a 7.5% 2Q drop.Compensation costs, however, were revised up significantly to a 5.4% quarterly rate of growth and by 2.5% y/y.
The downward revision of productivity and the upward revision
to compensation lessened the previously reported decline in unit labor
costs. Nevertheless, the 2.5% decline remained the third consecutive
quarterly fall but it eased the y/y change to -1.4%.
The surge in 3Q worker productivity growth in the factory sector was revised little at a 13.4% (AR) increase. That was a record and it lifted y/y growth to 3.0%, the highest since early-last year. The increase came as output rose at an 8.4% rate (-10.7% y/y) and hours worked fell at a 4.4% rate (-13.3% y/y). Compensation rose at an upwardly revised 6.5% rate (6.1% y/y), therefore unit labor costs in the factory sector fell at a lessened 6.1% annual rate (+3.0% y/y).
The productivity & cost figures are available in Haver's USECON database.
Fed Chairman Ben S. Bernanke's Senate testimony today can be found here.
| Nonfarm Business Sector (SAAR,%) | 3Q '09 (Revised) | 3Q '09 (Prelim.) | 2Q '09 | 1Q '08 | Y/Y | 2008 | 2007 | 2006 |
|---|---|---|---|---|---|---|---|---|
| Output per Hour | 8.1 | 9.5 | 6.9 | 0.3 | 4.0 | 1.8 | 1.9 | 0.9 |
| Compensation per Hour | 5.4 | 3.8 | 6.9 | -4.7 | 2.5 | 2.8 | 4.2 | 3.8 |
| Unit Labor Costs | -2.5 | -5.2 | -0.0 | -5.0 | -1.4 | 1.0 | 2.3 | 2.8 |
| Manufacturing Sector | ||||||||
| Output per Hour | 13.4 | 13.6 | 6.8 | -2.5 | 3.0 | 0.8 | 3.2 | 1.0 |
| Compensation per Hour | 6.5 | 5.5 | 6.5 | -0.4 | 6.1 | 3.0 | 4.3 | 2.0 |
| Unit Labor Costs | -6.1 | -7.1 | -0.3 | 2.2 | 3.0 | 2.2 | 1.1 | 0.9 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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