It was reported one month ago that productivity in the fourth quarter of 2009 increased at a rate of 6.2%. According to a newer report released today, in fact productivity rose at a rate of 6.9%. Economists say this higher productivity rate explains why the economy grew in the last quarter of the year, despite the fact that no new jobs were created. Economists also explained that this is good news for those worried about inflation as a slack economy and falling unit labor costs mean that inflation should not be an issue. Productivity for the third quarter of 2009 was also revised higher - from an annual rate of 7.2% to an annual rate of 7.8%. In both cases the revision was even more positive than most experts had expected it to be.
See "Productivity revised higher in second half of 2009", Rex Nutting, Market Watch, March 4, 2010