Consider these varied reactions to today's productivity and costs report for the second quarter --
U.S. productivity decelerates to 2.2%
Annual gain in unit labor costs fastest in five years
From Reuters (through USA Today):
Productivity growth slows; growth in labor costs down
U.S. 2nd-Qtr Productivity Rises at 2.2% Rate; Labor Costs Gain
Each of the statements above is true, of course. Unit labor costs grew, although at a lesser pace than the first quarter, and much reduced rate compared to the fourth quarter of last year. Growth over the last four quarters continued to tick-up, but that statistic is dominated by the unusually high growth at the end of last year and the beginning of this year.
Overall, I view this as fairly positive news. The fall-off in the productivity growth rate was not unanticipated in light of the "soft patch" this spring (which we appear to have sailed through for the moment), and the realized rate was actually a bit better than I expected. Labor costs are moving in the right direction, and the report seems to confirm the belief that the previous six months were something of an aberration. For now, I'm feeling almost cheery.