US Q1 nonfarm productivity revised down to 0.3%; unit labor costs revised to 1.8%

Created at 4 Jun · 12:39 UTC4 sources↑ Market-relevant3 events

IN SHORT

US nonfarm productivity growth in Q1 was revised down to a 0.3% annualized rate, the slowest since Q1 2025. Unit labor costs increased at a 1.8% rate, a downward revision from 2.3%. Economists expect AI integration to boost future productivity.

Key Numbers

0.3%Q1 nonfarm productivity annualized growth rate (revised)

0.8%Q1 nonfarm productivity annualized growth rate (initial estimate)

0.5%Q1 nonfarm productivity growth rate forecast

2.8%Productivity growth rate year-ago

1.6%Q1 GDP growth rate (revised)

2.0%Q1 GDP growth rate (initial estimate)

1.8%Q1 unit labor costs annualized rate (revised)

2.3%Q1 unit labor costs annualized rate (initial estimate)

2.5%Q1 unit labor costs growth rate forecast

0.5%Unit labor costs growth rate year-ago

2.1%Q1 hourly compensation annualized rate

3.3%Hourly compensation growth rate year-ago

Who's Involved

Labor Department's Bureau of Labor Statistics

released revised US nonfarm productivity and labor cost data

Reuters

Key facts

US Q1 nonfarm productivity growth revised down to 0.3% annualized rate.

Unit labor costs increased at a 1.8% rate in Q1.

Hourly compensation increased at a 2.1% rate in Q1.

Q1 GDP growth was previously reported at 2.0% but revised down to 1.6%.

U.S. worker productivity growth in the first quarter slowed more than initially estimated, with the annualized rate revised down to 0.3%. This marks the slowest pace since the first quarter of 2025. The revision aligns with a previous downgrade to Q1 gross domestic product growth to 1.6%. Unit labor costs, a measure of the price of labor per unit of output, increased at a revised 1.8% annualized rate, down from the initial estimate of 2.3%. Hourly compensation rose at a 2.1% rate in the quarter. Economists anticipate that the increasing integration of artificial intelligence will contribute to future productivity gains and help control labor costs.

US Q1 nonfarm productivity revised down to 0.3%; unit labor costs revised to 1.8%

PiQ Daily

US Q1 nonfarm productivity revised down to 0.3%; unit labor costs revised to 1.8%

PiQ Daily

Key facts

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