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Drop in productivity most likely a statistical mirage

The 2.5% slump in productivity over the past year – the worst since records began in 1948 – is another illustration of the chasm that has opened up between the GDP and employment figures. The only plausible explanation to our minds is that one or both of those series will be revised over the coming months, leaving productivity growth stronger and unit labour cost growth weaker. CPI Drop-In (10th Aug): Will July finally mark the turning point for US inflation? Join our US Economics team for a briefing shortly after the CPI release for a briefing on the inflation outlook and the Fed response. Register now.  

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