WASHINGTON (MarketWatch) - The nation's productivity fell in the first quarter at a 1.7% annual rate, reflecting weak economic growth and disruptions caused at U.S. workplaces by harsh winter weather. Economists polled by MarketWatch had expected a seasonally adjusted 1.1% decline. Hours worked climbed 2.0% while output of goods and services rose a scant 0.3%, the Labor Department said Wednesday. Unit-labor costs jumped by 4.2% - the biggest increase in five quarters - but they rose just 0.9% in the 12 months ended March 31. Hourly wages advanced 2.4% in the first quarter, but just 0.5% after adjusting for inflation. The manufacturing sector was the one bright spot: productivity climbed 3.3% and inflation-adjusted wages rose 1.4%. Unit-labor costs among manufacturers barely increased with a 0.1% gain. In the fourth quarter, the increase in overall U.S. productivity was revised up to 2.3% from 1.8.
Read the full story: U.S. firms less productive in first quarter