Productivity surges and labor pressures ease - KWWL - Eastern Iowa Breaking News, Weather, Closings

Productivity surges and labor pressures ease

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WASHINGTON (AP) -- Productivity was increasing at the end of last year at three times the expected pace while labor costs slowed significantly, underscoring that a deepening recession has taken away the threat of inflation.

The Labor Department said Thursday that productivity rose at an annual rate of 3.2 percent in the final three months of last year, far above the 1.1 percent rise that economists had expected. The increase was double the 1.5 percent rise in productivity in the third quarter.

Meanwhile, the government says unit labor costs edged up at a 1.8 percent annual rate in fourth quarter, far lower than the 2.9 percent rise that had been forecast. Labor costs had risen at a 2.6 percent rate in the third quarter.

Online Producer: Mike Verlo

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