WASHINGTON - U.S. nonfarm productivity rose at a 1.8% annual rate in the first quarter of 2011 according to the Labor Department's second estimate released Thursday.
That was up from an estimate of 1.6% growth in the earlier estimate, but down from a revised 2.9% in the fourth quarter of 2010. Productivity measures the ratio of hours worked to total output.
Unit labor costs, the ratio of hourly compensation to labor productivity, were up 0.7% from a 1.0% gain in the initial read, which followed a revised negative 2.8% in the fourth quarter of 2010. Output rose 3.2% from the revised 4.4% jump in the last quarter of 2010. Hours worked were up 1.4%, after a 1.5% increase in the prior quarter.
Economists were expecting a 1.7% increase in productivity and a 0.8% increase in unit labor costs according to the Thomson Reuters poll.
In the manufacturing sector, productivity grew 4.2% after a revised 4.9% increase in the previous quarter. Factory output was up 7.7% after a revised 3.9% gain the prior quarter. Unit labor costs in manufacturing continued to decline, falling 1.4% in the first quarter after a revised 1.6% decline in the fourth quarter.
