U.S. Productivity Tanks in Worst Decline Since 1974
The Labor Department reported on Thursday that the average yearly productivity of American workers decreased by 1.7% between 2021 and 2022, the greatest annual loss since 1974.
The Department of Labor said that even while output increased by 3.1% and hours worked by 1.4% in the final quarter of the year, labor productivity only increased by 1.7%.
This was 1.3% less than the initial prediction of a 3.0% gain. Analysts had predicted a much more moderate fall of 2.5%.
Productivity fell by 1.8% when compared to the fourth quarter of 2021.
The Labor Department said on Thursday that annualized increases in unit labor costs—a measure of what companies spend to create a unit of output—rose by 3.2% from October through December.