Q1 Worker Productivity Shines

May 7, 2002 (PLANSPONSOR.com) - US worker productivity chugged ahead of analyst expectations, at a rate of 8.6% in the first quarter - its best performance in almost two decades, according to figures from the US Department of Labor (DoL).

The increase, which last reached this level in 1983, was chiefly due to businesses taking the scissors to payrolls and squeezing more labor out of their workers. Over the quarter, the total number of hours worked plummeted at a rate of 1.9%, while output increased at a rate of 6.5%.
The increase in productivity, or the amount of output per hour of work, followed a strong 5.5% of increase in the previous quarter, the DoL said.
Unit labor costs fell 5.4% over the period, clocking the largest fall since a 6.5% decline in the second quarter of 1983. In manufacturing, unit labor costs declined by 6.5%, the biggest drop in over four decades.