U.S. productivity rose faster than expected in the first three months of the year, as employers continued to squeeze existing workers to boost output before hiring new ones, Labor Department figures showed today (Thursday). But the rate of growth slowed, which may force businesses to increase hiring in the coming months.
Separately, fewer Americans filed claims for unemployment benefits for the third consecutive week, in a sign the labor market is slowly recovering from the worst recession since the 1930s.
Productivity rose at a 3.6% annual rate in the first quarter, exceeding the 2.6% median forecast of economists surveyed by Bloomberg News but down sharply from 6.3% in the previous three months.
Productivity Increase
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Slower Productivity Growth May Force Businesses to Increase Hiring
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Looking For a Bright Spot? Productivity Growth May be America's Secret Weapon
The U.S. employment picture isn't pretty. At 10%, the unemployment rate is at its highest level in nearly three decades, and it's expected to move higher. American employers cut 4.2 million jobs last year, and nearly 15.3 million people are unemployed.
Those bemoaning the increase in U.S. joblessness are right to do so. But they should also remember that unemployment is a direct result of the U.S. economy's greatest strengths - its ability to grow productivity even in a recession.
The Conference Board publishes a Total Economy Database, which gives productivity growth figures - nearly 50 years' worth, in some cases - for most of the world's major economies. The results for 2009 were just released. And the Conference Board's conclusion jumps right off the page at you: The U.S. economy is nowhere near as bad off as many pessimists believe.
In the U.S. economy's bid to rebound in this post-financial-crisis world, productivity growth may be this country's secret weapon.
Those bemoaning the increase in U.S. joblessness are right to do so. But they should also remember that unemployment is a direct result of the U.S. economy's greatest strengths - its ability to grow productivity even in a recession.
The Conference Board publishes a Total Economy Database, which gives productivity growth figures - nearly 50 years' worth, in some cases - for most of the world's major economies. The results for 2009 were just released. And the Conference Board's conclusion jumps right off the page at you: The U.S. economy is nowhere near as bad off as many pessimists believe.
In the U.S. economy's bid to rebound in this post-financial-crisis world, productivity growth may be this country's secret weapon.
How can productivity fuel the rebound? Read on...
Analysts Hope Productivity Increase Can Stem Job Cuts, Lead to Increased Corporate Profits
By Jason SimpkinsManaging EditorMoney Morning Worker productivity rose in the first quarter, as companies cut costs by shedding workers and extracted more output from remaining employees. Analysts are hopeful that the increased efficiency will help slow rate of job cuts, which also appear to be easing from their formerly torrid pace. Productivity, a measure of […]
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