Weak Productivity

Workplace Buzz on June 7, 2007 1:12 PM

(Reuters) - Worker productivity grew at a slower pace than initially estimated in the first quarter, driving up labor costs and reinforcing concerns about inflation.

The Labor Department said on Wednesday that nonfarm productivity, a measure of how much any given worker can produce in an hour, rose at a 1 percent annualized pace in the quarter after a 2.1 percent fourth-quarter advance.

A month ago, the department had estimated productivity grew at a 1.7 percent rate.

On the labor front, U.S. employers announced plans in May to eliminate 71,115 jobs, up 32 percent from May 2006 when job cuts totaled 53,716.

It was the second consecutive month in which job cuts increased from the year earlier period, according to the monthly job-cut report released on Wednesday by global outplacement consultancy Challenger, Gray & Christmas, Inc.

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