Business Productivity Fell in Second Quarter

Washington, DC, Sept. 2, 2010--Business productivity fell a revised 1.8% in the second quarter, the biggest drop in almost four years and twice as much as the Labor Department initially reported.

Last month, the Labor Department estimated that productivity fell 0.9% to mark the first decline in five quarters. Yet worker output grew at a slower pace based on newly revised data.

Real output grew just 1.6% in the second quarter, compared with a prior estimate of 2.6%. Output expanded at a much faster 5% rate in the first three months of 2010.

Hours worked rose at a 3.5% annualized rate -- the fastest in four years.

Productivity rose 3.6% in the first quarter and 6.3% in the final quarter of 2009.

Meanwhile, unit labor costs rose 1.1% rate in the second quarter -- up from an initial reading of 0.2% -- for the biggest increase since the end of 2008.