Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
 
 

Blog Home
   Brian Wesbury
Chief Economist
 
Bio
X •  LinkedIn
   Bob Stein
Deputy Chief Economist
Bio
X •  LinkedIn
 
  Non-farm producitivty increased at a 2.6% annual rate in Q4
Supporting Image for Blog Post

 
Implications:  Productivity beat consensus expectations in the fourth quarter, rising at a 2.6% annual rate, equaling the robust average pace of the past ten years.  What's impressive about the fourth quarter is that the gains in productivity came at the same time that the number of hours worked increased at a healthy 1.8% rate.  Oftentimes, once a recovery gets to the point where firms are vigorously increasing hours, the pace of productivity growth slows down.  Although that happened in the first half of 2010, in the latter half of the year companies found a way to generate efficiencies while still demanding more hours.  Not only are hours up but compensation per hour is up as well.  Despite this, productivity is pushing down unit labor costs – how much companies have to pay workers per unit of production.  In other words, productivity growth has been rapid enough to both generate pay increases and, at the same time, make it worth more for companies to hire.  As a result, we expect private sector hiring to accelerate in 2011.  In other news this morning, new claims for unemployment insurance declined 42,000 last week to 415,000.  Continuing claims for regular state benefits fell 84,000 to 3.93 million.  In other recent news on the job market, the ADP Employment index, a measure of private-sector payrolls, increased 187,000 in January.  This is consistent with our forecast that the official Labor Department report, released tomorrow morning, will show an increase of 195,000 in private payrolls.

Click here to view the entire report.
Posted on Thursday, February 3, 2011 @ 11:13 AM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.