Keeping you up to date on the latest data releases.
- Productivty and Costs
Nonfarm business sector productivity was revised up from a strong 6.2 percent (annualized rate) gain to 6.9 percent in the fourth quarter, and is now up a whopping 5.8 percent on a year-over-year basis (its highest growth rate since 2002:Q1). The stronger fourth quarter reading was a result of an upward revision to output (revised up from 7.2 percent to 7.6 percent), while hours worked suffered a slight downward adjustment (from 1.0 percent to 0.6 percent). It is still the first increase in hours since 2007:Q2, though its four-quarter growth rate is still solidly negative (−5.7 percent). Compensation estimates were also shaded to the downside, resulting in a 5.9 percent drop in unit labor costs in the fourth quarter, compared to an initial reading of −4.4 percent. Unit labor costs have plummeted over the past year, down 4.7 percent—its sharpest decline on record (going back to 1947).