Global| Dec 07 2004U.S. Productivity Growth Little Revised for 3Q
by:Tom Moeller
|in:Economy in Brief
Summary
Non-farm labor productivity growth last quarter was little revised at 1.8% and about matched Consensus expectations for 2.0% growth. Growth in hours worked by all persons (employment times hours) was revised up to 2.4% (1.5% y/y) from [...]
Non-farm labor productivity growth last quarter was little revised at 1.8% and about matched Consensus expectations for 2.0% growth.
Growth in hours worked by all persons (employment times hours) was revised up to 2.4% (1.5% y/y) from 2.1% but output growth also was revised up to 4.2% (4.7% y/y), the same as in 2Q.
Unit labor costs grew 1.8% as compensation growth was left unchanged at 3.6% (4.0% y/y).
Productivity in the manufacturing sector was revised up to 4.6% (4.7% y/y) from 4.3%. Unit labor cost growth in the factory sector was revised down slightly to no change (-1.5% y/y).
In the nonfinancial corporate sector productivity growth accelerated to 4.2% (3.1% y/y) from 3.3% in 2Q. This is the first release of figures for 3Q. Output, a figure derived from the income side of the National Income & Product Accounts, grew at a 5.6% (4.8% y/y) rate versus 4.2% growth in 2Q. Hours worked grew at a 1.3% rate (1.7% y/y).
During the last ten years there has been an 86% (inverse) correlation between y/y growth in unit labor costs in the nonfinancial corporate sector and profit growth.
From The Federal Reserve Bank of Chicago is this paper titled "The acceleration in U.S. total factor productivity after 1995: The role of information technology."
| Non-farm Business Sector (SAAR) | 3Q '04 (Revised) | 3Q '04 (Prelim.) | 2Q '04 | Y/Y | 2003 | 2002 | 2001 |
|---|---|---|---|---|---|---|---|
| Output per Hour | 1.8% | 1.9% | 3.9% | 3.1% | 4.4% | 4.4% | 2.5% |
| Compensation | 3.6% | 3.6% | 5.9% | 4.0% | 4.1% | 3.3% | 4.0% |
| Unit Labor Costs | 1.8% | 1.6% | 1.9% | 0.8% | -0.4% | -1.1% | 1.5% |
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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