Sharply rebounding from a 0.1% drop in the prior quarter, labor productivity increased 3% in the fourth quarter of 2006, the Labor Department said Feb. 7.
The report on nonfarm productivity, seen as key to increasing living standards without inflation, was better than the 2% gain expected by Wall Street analysts.
However, the overall gain in productivity for 2006 was 2.1%, the weakest since 1997 and a continued decline from a peak in 2002 or 4.1%.
The report showed unit labor costs rose by 1.7% in the fourth quarter, sharply down from the 3.2% gain of the previous quarter and slower than the pace economists had expected. Unit labor costs, a key element of inflation, have risen 2.8% since the fourth quarter of 2005.
Copyright Agence France-Presse, 2007