Today the BLS released Labor Productivity and Costs for 2023 Q1. Let’s take a look.
Labor Productivity Details
- Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked by all persons, including employees, proprietors, and unpaid family workers.
- Nonfarm business sector labor productivity decreased 2.7 percent in the first quarter of 2023
- Output increased 0.2 percent and hours worked increased 3.0 percent.
- From the same quarter a year ago, nonfarm business sector labor productivity decreased 0.9 percent, reflecting a 1.3-percent increase in output and a 2.3-percent increase in hours worked.
- The 1.1-percent rate of productivity growth in the current business cycle thus far is a historically low productivity growth rate; no other previous business cycle had lower productivity growth, except for the brief six-quarter cycle from 1980 Q1 to 1981 Q3, which exhibited 1.0 percent growth.
- The 0.9-percent productivity decline is the first time the four-quarter change series has remained negative for five consecutive quarters; this series begins in the first quarter of 1948.
Unit Labor Cost Details
- Unit labor costs in the nonfarm business sector increased 6.3 percent in the first quarter of 2023, reflecting a 3.4-percent increase in hourly compensation and a 2.7-percent decrease in productivity.
- Unit labor costs increased 5.8 percent over the last four quarters.
- Real hourly compensation, which takes into account consumer prices, decreased 0.3 percent in the first quarter of 2023, and declined 1.0 percent over the last four quarters.
Labor Productivity and Costs, Percent Change from Prior Quarter
What’s Going On With Productivity?
- Biden rules and regulations
- Biden’s clean energy push including the ridiculously-named Inflation Reduction Act (IRA)
- Retiring baby boomers are replaced by less skilled workers
What’s Going On With Wages?
- Quiet Quitting, Doing Only What’s Necessary at Work and No More
- Act Your Wage is the New Meme as Career Ambitions Plunge
Costs Up, Output Down
With special thanks to the IRA costs are soaring but output isn’t.
For more on the IRA please see The Inflation Reduction Act Price Jumps From $385 Billion to Over $1 Trillion
This post originated at MishTalk.Com.
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Member Bank Reserve Requirements: Analysis of Committee Proposal, Box 107 (stlouisfed.org)
The future of the United States holds that it will be forced into (1) a high degree of economic isolation, (2) reflect an increasingly totalitarian mold, (3) and operate under a command economy.
DXY is down on a good payroll report.
Reuters: “These officials also noted the Fed at some point could even lower short-term interest rates as it continues to draw down the roughly $8.5 trillion balance sheet, and that such a move would not be at odds with wider monetary policy.”
The FED should cut interest rates NOW – and continue with QT. The 1966 Interest Rate Adjustment Act is prima facie evidence.
only, everyone fails to grasp a situation that is actually worldwide.”
The US is in full collapse. Thank President Biden and his perpetual war and ultra wokism. Who voted for this clown? Institutions are in full decay by concerted design to allow the totalatarians to take full control of the sheeple. Bray they allow us a few oats to chew on. In another step to demoralize and destroy institutions we have this.
Australian doctor is leading a new class action against the federal
government and key medical figures.”
predicted in 1963 in my Money and Banking book, Dr. Pritchard’s (Ph.D.
Economics, Chicago 1933, M.S. statistics, Syracuse, Phi Beta Kappa) economic
syllogism posits:
funds is to be maintained and deflationary effects avoided”…
aggregate demand and therefore produces adverse effects on gDp”
time-deposit banking, would tend to have a longer-term debilitating effect on
demands, particularly the demands for capital goods.”
than 1 & 2 on this list. Young people have a very low tolerance for
bad behavior from older generations such as boomers who have a tendency
to condescend and belittle people. The young would rather quit and
do nothing than tolerate daily abuse or work in these environments.
Cue the “Nobody wants to work anymore!” rant from a boomer.”
I don’t think this bunch will buckle down and become good little wage slaves. There’s no American Dream as a reward anymore, and they know it.
Most people don’t work at anything involving essentials right now. We have a long way to go before there’s that kind of troubl.
Less skilled than boomers? At office politics maybe…