Global| Mar 07 2002Nonfarm Productivity Revision Unexpected
by:Tom Moeller
|in:Economy in Brief
Summary
Nonfarm labor productivity grew much more than expected last quarter. Growth was revised up to 5.2% from the preliminary estimate of 3.5%. Revised growth of 4.2% had been expected. Upward revision to productivity caused the price-to- [...]
Nonfarm labor productivity grew much more than expected last quarter. Growth was revised up to 5.2% from the preliminary estimate of 3.5%. Revised growth of 4.2% had been expected.
Upward revision to productivity caused the price-to-unit labor cost ratio, a key measure of corporate profitability, to rise despite lower prices.
Unit Labor costs fell more than twice as much as originally estimated as a result of the upward productivity estimate. Compensation growth was little changed, and it has slowed considerably from its peak growth rate of 8.1% in 2Q 2000.
The upward revision to productivity growth was the result of output growth that was revised to 1.2% from -0.4%. Hours worked were little changed at -3.8%.
Inflation was benign with the price deflator for the nonfarm business sector declining 0.6%, the first decline since 3Q 1954.
Manufacturing sector productivity growth was revised to 4.1% following 2.6% growth in 3Q. Unit labor costs declined 1.5%.
| Nonfarm Business Sector | 4Q '01 | 3Q '01 | Y/Y | 2001 | 2000 | 1999 |
|---|---|---|---|---|---|---|
| Output per Hour | 5.2% | 1.1% | 2.9% | 1.9% | 3.3% | 2.3% |
| Compensation | 2.3% | 3.7% | 3.9% | 5.8% | 6.5% | 4.4% |
| Unit Labor Costs | -2.7% | 2.6% | 1.8% | 3.8% | 3.1% | 2.0% |
by Tom Moeller March 7, 2002
Initial claims for unemployment insurance fell less than expected in the latest week, and the prior week's level was revised slightly higher.
The four-week moving average of claims fell slightly to 372,750, the lowest level since August.
Continuing claims for unemployment insurance fell in the latest week. The prior week's level was revised down.
The insured rate of unemployment fell to 2.6%, the same level as four weeks earlier.
| Unemployment Insurance (000s) | 03/02 | 02/23 | Y/Y | 2001 | 2000 | 1999 |
|---|---|---|---|---|---|---|
| Initial Claims | 376.0 | 381.0 | 0.3% | 408.0 | 302.8 | 297.7 |
| Continuing Claims | -- | 3,406 | 42.6% | 3,3031 | 2,127 | 2,187 |
by Tom Moeller March 7, 2002
Consumer borrowing surged unexpectedly in January, continuing an upward trend that recently has accompanied strength in retail spending and declines in employment.
Commercial banks lent a record $6.0B (NSA) last month to pace the jump in nonrevolving credit (autos and other personal loans).
Revolving credit rose a modest amount after contracting in December. Large unadjusted declines were registered amongst many issuers.
| Consumer Credit Outstanding | Jan '02 m/m | Dec '01 m/m | Y/Y | 2001 | 2000 | 1999 |
|---|---|---|---|---|---|---|
| Total | $12.8B | $1.8B | 5.9% | 6.1% | 10.2% | 7.5% |
| Revolving | $1.2B | $-5.6B | 3.6% | 3.9% | 11.5% | 6.3% |
| Nonrevolving | $11.7B | $7.5B | 7.7% | 7.7% | 9.2% | 8.4% |
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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