Productivity Rate Falls for First Time in Six Years

May 8, 2001
The U.S. production rate fell 0.1% during the first quarter, marking the first such drop since a 0.8% rate of decrease in the first quarter of 1995. The decrease followed a 2% annual rate of productivity growth in the fourth quarter of last year, the Labor Department said today. The report also said unit labor costs jumped by a 5.2% rate in the first quarter. That’s the biggest increase since the
The U.S. production rate fell 0.1% during the first quarter, marking the first such drop since a 0.8% rate of decrease in the first quarter of 1995. The decrease followed a 2% annual rate of productivity growth in the fourth quarter of last year, the Labor Department said today.

The report also said unit labor costs jumped by a 5.2% rate in the first quarter. That’s the biggest increase since the fourth quarter of 1997, when they rose at a 5.5% rate.

The drop in productivity — the amount of output per hour of work — during the January-March quarter surprised analysts, who generally were expecting an increase of 1% at an annual rate.

Gains in productivity are the key to rising living standards because they allow wages to increase without triggering higher inflation that would eat up those wage gains. However, if productivity falters, pressures for higher wages sometimes force companies to raise prices, causing inflation to kick in.

About the Author

Tim Parry

Tim Parry is a former FleetOwner editor. 

Voice your opinion!

To join the conversation, and become an exclusive member of FleetOwner, create an account today!

Sponsored Recommendations

What challenges are top of mind for fleet professionals in 2025? Get exclusive insights from the 2025 Fleet Trends Survey and discover where the industry is headed next.
The most successful fleets accomplish more than delivering freight. To accomplish this, fleets need a fuel that’s reliable, more economical and more sustainable. That fuel is ...
Are your KPIs driving real fleet improvement? Learn how to set smarter, data-driven benchmarks, track success like top-performing fleets, and apply proven strategies to optimize...
Learn how eets can enhance truck utilization and minimize safety incidents using business intelligence and AI. Delve into innovative practices, technology integration and real...