U.S. productivity tumbles in first quarter; labor costs surge, Reuters, 6/2/22

Nonfarm productivity, which measures hourly output per worker, tumbled at a 7.3% annualized rate last quarter, the deepest since the third quarter of 1947, the Labor Department said on Thursday. That was an upward revision to the 7.5% pace of decline estimated last month.

Productivity grew at a 6.3% rate in the fourth quarter.

Productivity fell at an unrevised 0.6% pace from a year ago.

Unit labor costs - the price of labor per single unit of output - accelerated at a 12.6% rate. That was revised up from the 11.6% growth pace reported in May and followed a 3.9% expansion rate in the October-December quarter.

Unit labor costs increased at an 8.2% rate from a year ago, instead of the 7.2% pace estimated last month. An acute shortage of workers is boosting wage growth. There were 11.4 million job openings at the end of April.

Hourly compensation rose at a 4.4% rate in the first quarter, revised up from the previously estimated 3.2% pace. Compensation increased at a 7.6% rate compared to the first quarter of 2021. It was previously estimated to have increased at a 6.5% pace.