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Wed Nov 6, 2019, 11:34 AM

U.S. Productivity Unexpectedly Posts First Drop Since 2015

By Reade Pickert
Bloomberg November 6, 2019

(Bloomberg) -- Productivity in the U.S. unexpectedly posted the first decline in almost four years and labor costs accelerated, suggesting a pickup in efficiency earlier this year was more of a temporary shift.

Nonfarm business employee output per hour decreased at a 0.3% annualized rate in the third quarter, according to Labor Department figures Wednesday. That compared with the median projection for a 0.9% increase in Bloomberg’s survey of economists and followed an upwardly revised 2.5% gain in the second quarter. Unit labor costs rose at a 3.6% rate following 2.4% in the prior period.

The decline in productivity resulted from a 2.1% increase in output against a 2.4% rise in hours worked. The Labor Department said self-employed workers “made an unusually large contribution” to the increase in hours worked during the quarter and those particular numbers can be more volatile than for the broader workforce. The number of self-employed Americans had risen from the prior quarter.

That increase “likely depressed productivity more than we were anticipating,” said Ryan Sweet, director of real-time economics at Moody’s Analytics. “The trend overall for productivity is still mediocre at best and that suggests that the economy’s potential growth rate hasn’t really changed too much.”

While the report partly reflects a deceleration in economic growth during the quarter, it raises questions about whether the Trump administration’s tax cuts -- which took effect last year -- will sustain a pickup in productivity after already showing signs of failing to prop up business investment.

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https://finance.yahoo.com/news/u-productivity-unexpectedly-posts-first-133001516.html

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RCW2014 Wednesday OP
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Wed Nov 6, 2019, 12:08 PM

1. Democrats Cheer !!!

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Wed Nov 6, 2019, 01:45 PM

2. Buy stocks everyone. Hurry, you might miss out

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