Today’s US Q4 productivity report showed a 3.0% contraction. According to analysts from Wells Fargo, it reflected a substantial slowdown in output growth and gains in hours worked.
Key Quotes:
“Marking the largest annualized decline since Q1 2014, nonfarm productivity declined 3.0 percent in Q4 2015 as output growth stagnated to a 0.1 percent pace and hours worked jumped 3.3 percent.”
“Real compensation costs increased 2.8 percent in 2015, the largest annual gain in 15 years.”
“Reflecting just how historically weak productivity has been in this recovery, the annual average rate of productivity growth from 2007 to 2015 has run at a 1.2 percent pace, well below the long-term rate of 2.1 percent from 1947-2015. Unfortunately, the weak productivity growth trend remains firmly in place.”
(Market News Provided by FXstreet)