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The Department of Labor reported that U.S. productivity only increased by 0.3 percent in the first quarter of 2024, a significant drop from the 3.5 percent growth seen in the previous quarter. Over the past year, U.S. productivity has risen by 2.9 percent. Productivity is a measure of economic performance that compares the amount of goods and services produced to the inputs used in production.
Unit labor costs, an important indicator of wage inflation, increased by 4.7 percent in the first quarter of 2024. This figure is calculated by subtracting the 0.3 percent productivity gain from the 5.0 percent rise in hourly compensation during the same period. Over the past year, unit labor costs have seen a 1.8 percent increase.
