U.S. Productivity Spikes In Q2 As Hours Plummet More Than Output
Labor productivity in the U.S. soared by much more than expected in the second quarter, according to a report released by the Labor Department on Friday.
The report said labor productivity spiked by 7.3 percent in the second quarter after dipping by a revised 0.3 percent in the first quarter.
Economists had expected labor productivity to jump by 1.5 percent compared to the 0.9 percent decrease that had been reported for the previous quarter.
The much bigger than expected increase in productivity, a measure of output per hour, came as hours worked plummeted by even more than output.
Hours worked plunged by 43.0 percent in the second quarter after slumping by 6.1 percent in the first quarter, while output cratered by 38.9 percent after tumbling by 6.4 percent.
Meanwhile, the Labor Department said unit labor costs skyrocketed by 12.2 percent in the second quarter after surging up by 9.8 percent in the first quarter.
Economists had expected unit labor costs to spike by 6.2 percent compared to the 5.1 percent surge that had been reported for the previous quarter.
Unit labor costs showed the biggest increase since the first quarter of 2014, as hourly compensation soared by 20.4 percent in the second quarter after jumping by 9.4 percent in the first quarter.
Real hourly compensation, which takes into account changes in consumer prices, spiked by 24.8 percent in the second quarter after surging up by 8.1 percent in the previous quarter.