U.S. first-quarter worker productivity unrevised at 5.4%
9:17 am Thursday, June 03rd, 2021
WASHINGTON (Reuters) – U.S. worker productivity rebounded solidly in the first quarter, the government confirmed on Thursday, also noting that labor costs grew instead of contracting as previously reported.
Nonfarm productivity, which measures hourly output per worker, increased at an unrevised 5.4% annualized rate last quarter, the Labor Department said. Productivity fell at a 3.8% rate in the fourth quarter. Economists polled by Reuters had expected productivity would be raised to a 5.5% rate.
Productivity shot up early in the pandemic before slumping in the final three months of 2020. Economists attributed the jump to the hollowing out of lower-wage industries, like leisure and hospitality, which they said tended to be less productive.
Compared to the first quarter of 2020, productivity rose at an unrevised 4.1% rate.
Hours worked increased at a 3.0% rate last quarter, revised slightly up from the 2.9% pace estimated last month.
Unit labor costs – the price of labor per single unit of output – increased at a 1.7% rate. They were previously reported to have dropped at a 0.3% pace. Unit labor costs surged at a 14.0% rate in the fourth quarter. They rose at a 4.1% pace from a year ago, instead of at a 1.6% rate as previously reported.
They have also been distorted by the pandemic’s disproportionate impact on lower-wage industries.
Hourly compensation increased at a 7.2% rate last quarter, rather than the previously reported 5.1% pace. That followed a 9.7% growth pace in the fourth quarter. Compensation increased at an 8.3% rate compared to the first quarter of 2020, revised up from the previously estimated 5.8% pace.
(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama)
