With output rising by much less than previously estimated, the Labor Department released a report on Thursday showing a notable downward revision to the pace of labor productivity growth in the fourth quarter of 2013.
The report said productivity increased by 1.8 percent in the fourth quarter compared to the previously reported 3.2 percent increase. Economists had expected the pace of productivity growth to be downwardly revised to 2.4 percent.
The downward revision to productivity, which is a measure of output per hour, came as revised data said output rose by 3.4 percent versus the previously reported 4.9 percent jump.
At the same time, the report showed a modest revision to the increase in hours, which rose by 1.6 percent compared to the previously reported 1.7 percent increase.
With the downward revision, the increase in productivity in the fourth quarter reflects a notable slowdown from the 3.5 percent growth seen in the third quarter.
Additionally, the Labor Department said unit labor costs edged down by just 0.1 percent in the fourth quarter, reflecting a notable revision from the previously reported 1.6 percent drop. The decrease in unit labor costs had been expected to be revised to 0.5 percent.
The modest decrease in labor costs came as the increase in productivity was only slightly larger than the 1.7 percent increase in hourly compensation.
Real hourly compensation, which takes changes in consumer prices into account, rose by 0.8 percent in the fourth quarter after falling by 1.2 percent in the third quarter.
Compared to the same quarter a year ago, productivity rose by 1.3 percent in the fourth quarter, as output and hours worked increased by 2.9 percent and 1.7 percent, respectively.
Unit labor costs subsequently fell 0.9 percent year-over-year amid a 0.3 percent increase in hourly compensation.
by RTT Staff Writer
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Posted by Unknown on Thursday, March 6, 2014 - Rating: 4.5
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