September 2, 2009

NOTHING SAYS HYSTERICAL LIKE INFLATION FEARS COUPLED WITH FALLING LABOR COSTS:

Productivity up 6.6 percent in 2Q, most in 6 years (MARTIN CRUTSINGER, 9/02/09, AP)

Worker productivity, the single biggest factor determining living standards, grew at the fastest pace in nearly six years in the spring while labor costs fell by the most in nine years, as companies slashed costs to survive the recession. [...]

This cost-cutting helped many companies report better-than-expected second-quarter earnings despite falling sales. But economists worry that such aggressive cuts will make it harder to mount a sustainable recovery. That's because the lack of wage growth and shortage of jobs will depress household incomes and make the prospects for a sustained rebound in consumer spending less likely.


The recession is over and jobs cuts never got all the way through the fat to the muscle.

Posted by Orrin Judd at September 2, 2009 8:46 AM
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