Global| Jun 06 2012U.S. Labor Productivity Is Revised Downward
by:Tom Moeller
|in:Economy in Brief
Summary
Labor productivity for Q1'12 was weaker than reported initially. However, the -0.9% (AR) revised figure was accompanied by a bigger downward revision to compensation growth to 0.4%. As a result, growth in unit labor costs was lessened [...]
Labor productivity for Q1'12 was weaker than reported initially. However, the -0.9% (AR) revised figure was accompanied by a bigger downward revision to compensation growth to 0.4%. As a result, growth in unit labor costs was lessened to 1.3% from 2.0% reported last month. This easing in cost pressures follows a marked acceleration during all of last year. For 2011, weaker productivity growth of 0.6% and higher compensation growth of 2.5% raised unit labor costs by 1.9% following an outright decline of 2.0% in 2010.
In the factory sector, the productivity picture is brighter due to the continued payoff from investment in new technologies. Last quarter's productivity was lessened modestly to 5.2% from 5.9%, but that was an improvement following the 0.6% uptick in Q4'11. At the same time, growth in compensation last quarter also was lessened to zero. As a result, unit labor costs fell at a revised, faster 4.9% rate, the swiftest decline in two years. These figures follow the 1.0% decline in unit labor costs during all of last year after the 4.7% decline in 2010.
The productivity & cost figures are available in Haver's USECON database.
| Productivity & Costs (SAAR,%) | Q1'12 (Revised) | Q1'12 | Q4'11 | Q3'11 | Q1 Y/Y | 2011 | 2010 | 2009 |
|---|---|---|---|---|---|---|---|---|
| Nonfarm Business Sector | ||||||||
| Output per Hour (Productivity) | -0.9 | -0.5 | 1.2 | 1.8 | 0.4 | 0.6 | 4.0 | 2.4 |
| Compensation per Hour | 0.4 | 1.5 | 3.9 | 5.7 | 1.3 | 2.5 | 1.9 | 1.7 |
| Unit Labor Costs | 1.3 | 2.0 | 2.7 | 3.9 | 0.9 | 1.9 | -2.0 | -0.7 |
| Manufacturing Sector | ||||||||
| Output per Hour | 5.2 | 5.9 | 0.6 | 5.5 | 2.3 | 2.5 | 6.6 | 0.6 |
| Compensation per Hour | 0.0 | 1.5 | -3.7 | 3.2 | -0.7 | 1.5 | 1.6 | 4.6 |
| Unit Labor Costs | -4.9 | -4.2 | -4.2 | -2.2 | -2.9 | -1.0 | -4.7 | 4.0 |
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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