The first quarter saw U.S. worker productivity increase a little less than expected, while still exceeding market expectations, according to data from the Labor Department. Additionally, unit labor costs rose by less than predicted.
Nonfarm productivity measures hourly output per employee, and it grew at a 0.2% annualized rate during 2024’s first quarter—less than the initial prediction of 0.3% last month. Unit labor costs, on the other hand, increased at a 4.0% annualized rate, low than the Bureau of Labor Statistics’ expectation of 4.7%.
The data is unlikely to push the Federal Reserve to speed up interest rates cuts this year. However, some experts previously warned that BLS’ initial estimate from last month used data that was swayed by a seasonal quirk and the improved productivity could remain possible.
