US Productivity Growth Disappoints In Q1, Unit Labor Costs Surge

For the eighth straight quarter, US productivity grew in Q1, rising 0.4% QoQ (improving on Q4's +0.3%). However, the Q1 gain was less than the +0.6% expectation (and well below the preliminary +0.7% level) as Unit Labor Costs accelerated more than expected.

 

This is the equal longest streak of productivity gains since 2010 (which corresponded to the V-shaped bounce off the great financial crisis lows).

On the bright side for some, unit labor costs rose more than expected up 2.9% QoQ SAAR, the fastest rate since Q1 2017 and has accelerated in each of the last 4 quarters...

However, real compensation declined for the 3rd straight quarter.