With eyes on jobs, wages, and inflation, it's easy to forget how much impact productivity — the effort and cost that goes into a unit of work — can have on the economy.

The latest numbers that came out Thursday, May 2, showed a 0.3% month-over-month increase in productivity and a 2.9% year-over-year increase for the first quarter of 2024.

The weaker productivity does present a challenge for the Federal Reserve as unit labor costs were up 4.7% year over year in the first quarter, that being a combination of 5.0% increase in hourly non-farm hourly compensation and the 0.3% productivity increase.

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