U.S. fourth-quarter productivity slashed
WASHINGTON (Reuters) - The U.S. government on Thursday sharply revised down nonfarm productivity for the fourth quarter, mirroring the economy's slow growth pace in the same period.
Productivity rose at a 1.8 percent annual rate instead of the previously reported 3.2 percent pace, the Labor Department said on Thursday. Productivity, which measures hourly output per worker increased at a 3.5 percent pace in the third quarter.
Economists polled by Reuters had expected fourth-quarter productivity would be revised down to a 2.5 percent rate.
The government last week cut its estimate of fourth-quarter gross domestic product growth to an annual pace of 2.4 percent from the previously estimated 3.2 percent rate.
Underscoring the weak trend, productivity increased 1.3 percent compared to the same period in 2012. It was previously reported to have increased 1.7 percent.
For all of 2013, productivity increased 0.5 percent rather than 0.6 percent. That was the smallest gain since 1993 and compared to a 1.5 percent rise in 2012.
Unit labor costs - a gauge of the labor-related cost for any given unit of output - fell at a revised 0.1 percent rate in the fourth quarter, still showing weak wage-related inflation pressures in the economy. They had previously been reported to have dropped at a 1.6 percent rate.
Economists polled by Reuters had expected the drop in unit labor costs would be revised to a 0.9 percent rate.
Unit labor costs declined at a revised 2.1 percent rate in the third quarter. They were down 0.9 percent from the year-earlier period and were up 1.1 percent in 2013, the weakest reading since 2010.