Productivity Up 2.1%, Labor Dept. Says

The U.S. worker is becoming more productive, according to a government report released Wednesday morning.

The Department of Labor disclosed its revised figures on productivity and labor costs for the second quarter, announcing that productivity was up for the quarter by 2.1%.

Increased productivity has been credited as an integral part of the U.S economic boom in the late 1990s. When productivity increases, companies can produce more goods at a lower cost thus increasing the demand for trucking services.

Analysts credit the increases to more efficient use of labor after recent layoffs, Bloomberg said.

In the department’s sector-specific reports, manufacturing productivity was up 1.1% and productivity in the manufacture of durable goods was up 1.7%. Productivity in the making of non-durable goods was unchanged in the second quarter.

The health of the manufacturing sector is of vital importance to the trucking industry because of that sector’s reliance on trucking services to ship raw materials and finished goods.

Labor costs were up moderately from a previously reported 2.1% to Labor’s revised figure of 2.7%. Labor costs are a traditional harbinger of inflationary pressure.

The Aug. 30 edition of USA Today contained the results of a survey on the companies which have the highest rates of productivity growth. Among the companies cited was United Parcel Service, which had a 2.1% rate of growth for the company from 1996-2000.

In that article Federal Reserve Chairman Alan Greenspan said that increased productivity is a cure for the current malaise in the U.S. economy and the country’s best hope for sustained growth. (Click here for a related article.)

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