The preliminary data from the U.S. Labour Department showed on Thursday that nonfarm business sector labor productivity in the United States increased 3.6 percent q-o-q in the first quarter of 2019, as output advanced 4.1 percent q-o-q and hours worked rose 0.5 percent q-o-q (seasonally adjusted). 

That was the strongest increase in productivity since the third quarter of 2014 and was above economists’ forecast for a 2.2 percent q-o-q gain after a revised 1.3 percent q-o-q increase in the fourth quarter of 2018 (originally a 1.9 percent q-o-q surge).

In y-o-y terms, the labor productivity rose 2.4 percent in the first quarter, reflecting a 3.9-percent surge in output and a 1.5-percent increase in hours worked. 

Meanwhile, unit labor costs in the nonfarm business sector in the first quarter fell 0.9 percent q-o-q compared to a revised 2.5 percent q-o-q advance in the prior quarter (originally a 2 percent q-o-q climb). 

Economists had forecast a 1.5 percent gain in first-quarter unit labor costs. 

Unit labor costs quarterly decrease reflected primarily a 2.6-percent increase in hourly compensation and a 3.6-percent advance in labor productivity. 

Compared to the corresponding period of 2018, unit labor costs rose 0.1 percent, the lowest four-quarter rate since a 1.7-percent decline in the fourth quarter of 2013.