Over the last two quarters, US employment in the nonfarm business sector grew at a very strong 4.3 percent annual rate while output fell at a 2.3 percent annual rate. With average hours per worker decreasing, this means that output per hour, also called labor productivity or simply productivity, fell at a 6.0 percent annual rate. We also calculate an “optimistic” estimate of productivity growth assuming output rose in the first half of the year, but even this optimistic estimate fell at a 4.0 percent annual rate. Although productivity growth is very volatile and poorly measured at high frequencies, these declines are ... (full story)