Business
10:19 am
Thu June 4, 2009

Productivity increases more than expected in 1Q

WASHINGTON (AP) – WASHINGTON (AP) - The government says U.S. workers were more productive in the first quarter than previously estimated, as rapid layoffs meant companies were forced to make do with fewer employees.

The Labor Department said Thursday productivity, the amount of output per hour worked, rose at a seasonally adjusted annual rate of 1.6 percent in the January-March period, double the government's estimate last month.

That is also above analysts' expectations of 1.2 percent growth.

Higher productivity can raise living standards because workers that produce more can earn higher wages without forcing companies to raise prices.

But the increase resulted from a sharp cut in hours worked, which fell at a faster pace than output.