U.S. Labor Productivity Revised Down To 1.6%

In the fourth quarter of 2006, labor productivity gains were revised downward to 1.6% instead of 3% in an earlier estimate, the Labor Department said March 6.

The report on nonfarm productivity, seen as key to increasing living standards without inflation, was weaker than the 1.7% increase expected on Wall Street.

The modest gains came after a 0.5% drop in the third quarter, and the sluggish pace could make it harder to increase economic activity without inflation.

The overall gain in productivity for 2006 was 1.6 % instead of 2.1%. It was the weakest since 1997 and a continued decline from a peak in 2002 of 4.1%.

Copyright Agence France-Presse, 2007