Washington, DC, June 2--Productivity in the first quarter was revised up to reflect a 2.9 percent annual growth rate, according to the Labor Department.
Productivity growth was originally estimated at an annual rate of 2.6 percent a month ago.
Economists had forecast growth in first quarter productivity at a 3 percent annual rate.
The revision showed much stronger gains in compensation and wages than previously thought, and was in line with economists forecasts.
Unit labor costs, a key measure of inflationary pressures from compensation, rose a revised 3.3% annualized in the first quarter, up from the initial estimate of 2.2%.
Unit labor costs in the fourth quarter were revised to a 7.7% gain, up sharply from the initial estimate of a 1.7% increase. This is the sharpest increase since the third quarter of 2000.
Real hourly compensation (adjusted for inflation) increased a revised 3.9% in the first quarter, compared with the previous estimate of a 2.4% gain.
In the fourth quarter, real hourly compensation rose 10.2%, compared with the previous estimate of a 3.8% increase.
In the manufacturing sector, productivity increased a revised 4.4%, compared with the previous estimate of a 3.9% gain.
Productivity is measured by units of output per hour worked. It's an essential factor in long-term economic health, but is extremely difficult to measure in the short-run.
In the nonfinancial corporate sector, productivity increased 2.7% in the first quarter after rising 9.0% in the fourth quarter.
