Productivity Falls Unexpectedly
Tuesday, August 10, 12:25 PM ET

Falling productivity is an indication that unit labor costs may be rising faster than hourly earnings and other labor cost measures, and could be a good sign if it means companies are spending more on hiring. Unit labor costs increased 0.2%, marking the first increase since early 2009.

Employers are in fact adding jobs, albeit at a pace slower than the market would like to see; last week's employment report showed that private sector payroll employment edged up by 71,000 jobs. That's roughly half the level of monthly job creation analysts suggest is needed for a steady unemployment rate, with new jobs constantly needed to keep pace with population growth.