Nonfarm productivity falls 0.9% in Q2

WASHINGTON (MarketWatch) — The productivity of U.S. nonfarm businesses dropped in the second quarter at a 0.9% annual rate, the first decline after five quarters of strong growth, the Labor Department reported Tuesday.

A crude example of productivity is if one group of automobile employees can make five cars per day versus another group of employees who can make three cars per day. I just made up these numbers to make the point and do not reflect any special knowledge I have about making cars. A slowdown in productivity reflects the group of employees who made three cars per day, not five.

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