U.S. labor productivity in the nonfarm business sector rose at a 0.8% annualized rate in the first quarter of 2026, according to preliminary Bureau of Labor Statistics data released Thursday, while weekly jobless claims came in below expectations at 200,000. Manufacturing productivity increased 3.6% during the quarter as output rose and hours worked declined.
- Nonfarm business output increased 1.5% in Q1 while hours worked rose 0.7%.
- Unit labor costs increased 2.3% in the quarter, while real hourly compensation fell 0.5%.
- Manufacturing productivity increased 3.6%, including a 5.3% gain in durable manufacturing.
- The labor share of output fell to 54.1%, the lowest level recorded since the series began in 1947.
- Initial U.S. jobless claims rose by 10,000 to 200,000 for the week ended May 2, below economist expectations of 206,000.
- Continuing claims declined by 10,000 to 1.766 million.
- Fourth-quarter 2025 nonfarm productivity growth was revised down to 1.6% from 1.8%.
Relevant Companies
- SPDR S&P 500 ETF Trust ($SPY) – Broad labor productivity and employment data can influence overall equity market expectations.
- Caterpillar ($CAT) – Manufacturing productivity trends may affect industrial demand and labor cost dynamics.
- GE Aerospace ($GE) – Durable manufacturing productivity growth is relevant for large U.S. industrial and aerospace firms.
Editor’s Note: This is a developing story. This article may be updated as more details become available.
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