US productivity records largest decline since 1947 in the Q1

The US Department of Labor said that US productivity, which measures production per hour worked for each worker, fell by 7.5% in the first quarter of this year, the largest decline since the third quarter of 1947, compared to 6.3% in the fourth quarter of last year. On an annual basis, US productivity declined 0.6% in the first quarter compared to the same period last year, and hours worked rose 5.5% in the first quarter after rising at a 2.5% pace in the fourth quarter. Labor costs increased by 11.6% in the first quarter and on an annual basis, labor costs increased by 7.2% compared to the first quarter of last year, hourly compensation increased by 3.2% in the first quarter and on an annual basis compensation increased by 6.5% compared to the first quarter of 2021.