Global| Nov 03 2011U.S. Labor Productivity Growth Improves
by:Tom Moeller
|in:Economy in Brief
Summary
Worker productivity grew at the fastest rate last quarter since Q1'10. The 3.1% gain followed two quarterly declines. Nevertheless, the y/y increase held low at 1.1%, about where it's been all year. That compares to 4.1% growth during [...]
Worker productivity grew at the fastest rate last quarter since Q1'10. The 3.1% gain followed two quarterly declines. Nevertheless, the y/y increase held low at 1.1%, about where it's been all year. That compares to 4.1% growth during 2010. The Q3 increase exceeded Consensus expectations for 2.5% growth. Output rose at a 3.8% rate (2.5% y/y) and hours worked grew at a 0.6% rate (1.4% y/y), the weakest since Q1 of last year.
Compensation growth decelerated to 0.6%, the weakest since Q4 of last year. That weakness, with improved productivity, pushed down unit labor costs at a 2.4% rate (+1.2% y/y), the first decline since Q4'10. The moderate 1.2% y/y increase followed declines in both 2009 and 2010.
Factory sector productivity also bounced back last quarter. The 5.4% increase (3.0% y/y) was its greatest since Q4 2009. It resulted from a 4.7% gain (4.1% y/y) in real output and a 0.8% decline (+1.1% y/y) in hours worked. Compensation ticked up at just a 0.6% rate (2.5% y/y) so factory sector unit labor costs fell 4.6% (-0.5% y/y).
The productivity & cost figures are available in Haver's USECON database.
How Do Businesses Recruit? from the Federal Reserve Bank of Philadelphia is available here.
| Productivity & Costs (SAAR,%) | Q3'11 | Q2'11 | Q1'11 | Q3 Y/Y | 2010 | 2009 | 2008 |
|---|---|---|---|---|---|---|---|
| Nonfarm Business Sector | |||||||
| Output per Hour (Productivity) | 3.1 | -0.1 | -0.6 | 1.1 | 4.1 | 2.3 | 0.6 |
| Compensation per Hour | 0.6 | 2.7 | 5.6 | 2.3 | 2.1 | 1.6 | 3.3 |
| Unit Labor Costs | -2.4 | 2.8 | 6.2 | 1.2 | -2.0 | -0.7 | 2.8 |
| Manufacturing Sector | |||||||
| Output per Hour | 5.4 | -2.3 | 4.2 | 3.0 | 5.9 | -0.4 | -0.4 |
| Compensation per Hour | 0.6 | 3.0 | 4.1 | 2.5 | 1.6 | 4.5 | 4.3 |
| Unit Labor Costs | -4.6 | 5.5 | -0.2 | -0.5 | -4.2 | 4.0 | 4.8 |
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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