Productivity, or output per labor hour, fell 0.5% at an annual rate in the April-June period, the Labor Department said Tuesday, the third consecutive quarterly drop and well below the 0.4% rise economists expected. Productivity was down 0.4% over the previous 12 months, the first annual decrease since the second quarter of 2013.
The reason for the poor performance: Output increased 1.2% annualized while the number of hours worked rose 1.8%. Unit labor costs — the average cost of labor her unit of output — increased 2%.
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