US Q2 productivity up 1.8 pct, unit labor costs up 2.1 pct

BY

The efficiency of US workers in the second quarter rose more than twice as fast as the prior
quarter, while the the cost of hiring workers rose at the fastest annual pace in more than six years, the Labor Department said today.

US workers increased their productivity by 1.8 pct in the second quarter, slightly lower than the 2.1 pct increase economists had expected, but more than twice the 0.7 pct pace of the first
quarter.

Unit labor costs, or the costs of hiring workers, rose 2.1 pct in the second quarter, a bit higher
than the 1.6 pct gain economists had expected. This follows a revised 3.0 pct gain in labor costs in the first quarter, sharply higher than the 1.8 pct gain estimated earlier.

That leaves labor costs 4.5 pct higher than they were a year ago, the largest annual gain since
the third quarter of 2000. Productivity has risen 0.6 pct since the second quarter of 2006.

Real inflation adjusted income for workers fell 2.0 pct in the second quarter, following a revised 0.2 pct decline in the first quarter.

Unadjusted for inflation, hourly compensation rose 3.9 pct in the second quarter after rising 3.7 pct in the first three months of the year.