US productivity remains sluggish

Posted Tuesday, August 9, 2016 by
Skerdian Meta • 1 min read

The non-farm productivity in the US posted a 0.5% decline for the second quarter (Q2) against a 0.5% improvement. In 2014 and 2015 the productivity has been 0.9% and 0.8% respectively. But as the things are lined up right now, this year the productivity is expected to be -0.4%. The productivity is one of the best economic indicators to show how well an economy is performing and how dynamic it is.

If the productivity in an economy is improving, it means that the number of unemployed workers is very low and the wages are picking up fast, so businesses turn their focus on the productivity to increase production. That´s not the case right now with the US. The wages for the Q2 increased by 2% against 1.8% expected and last year's number was revised higher to 4.5% against 4.1% expected. I guess, this is not enough to turn the attention on the productivity.    

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