Productivity Rises 6.2%; Labor Costs Down 4.4%

U.S. nonfarm productivity increased at a 6.2% annual rate in the fourth quarter ended Dec. 31, as hours worked increased for the first time in more than two years, the Labor Department reported yesterday.

Unit labor costs fell 4.4%, a steeper decline than economists estimated.

For all of 2009, productivity increased 5.1%, the largest annual increase since 2002, while unit labor costs declined 2.8% for the year.

Economists polled by Thomson Reuters expected productivity to increase 6.0% for the quarter and for unit labor costs to

fall 2.5%, according to the median estimate.

Productivity for the third quarter was revised lower to a 7.2% increase from a reported 8.1% rise. Unit labor costs were revised to a 1.5% decline from a 2.5% decline.

Hourly compensation increased 1.5%.

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