Thursday, September 2, 2010

Worker productivity drops

WASHINGTON -- Productivity in the spring fell by the largest amount in nearly four years while labor costs rose, signals that companies may have reached the limits of squeezing more work out of fewer workers.
The Commerce Department says productivity dropped at an annual rate of 1.8 percent in the April-to-June quarter, double the 0.9 percent decline originally reported a month ago. Unit labor costs rose 1.1 percent, the biggest rise in labor costs since late 2008.
While lower productivity and higher labor costs could spell trouble for corporate profits, it could translate into more hiring and larger incomes for U.S. workers.

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