The basics, via CNNMoney:

U.S. nonfarm productivity rose at a faster-than-expected 3.2 percent annual rate in the first quarter while unit labor costs were nearly double forecasts as hourly compensation surged, preliminary Labor Department data showed Thursday...

"Because hourly compensation increased faster than productivity, unit labor costs increased during the first quarter," the Labor Department said in a statement.

Unit labor costs -- a key gauge of profit and price pressures monitored by the Federal Reserve for clues on wage inflation -- increased at a 2.5 percent annual pace.

I tried hard to find someone with something nice to say, to no avail.  Instead we got this, from Reuters...

"Labor costs have now become a warning flag for inflationary pressures. They are rising fast enough to create real concerns that businesses will have to recoup some of these costs through higher prices," Joel Naroff, head of Naroff Economic Advisors, told clients in a note.

and this, from MarketWatch...

Ian Shepherdson, chief U.S. economist at High Frequency Economics, said the 2.5% rise in unit labor costs was "bad news" for the market. "This is much faster than hourly earnings, so it presumably reflects increases in items like stock options, which have boosted costs in the past."
Kevin Giddis... said the report had serious implications.
"While the bond market actually sold off very little on this news, the potential for wage inflation is real and could cause further damage to the long end of the yield curve,"
Giddis said ...
and this, from Bloomberg:

"Labor costs are starting to rise as tight labor markets have workers clamoring for better wages,'' said Chris Rupkey, senior financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. "This is the first hint that the wage-price spiral has begun, and it is sure to be worrying Fed officials.'

Well, there was other good news. From Bloomberg:

U.S. stocks rose after oil prices slid below $70 a barrel, retailers posted their biggest monthly sales increase in two years...

But even that seems to imply you know what:

"I'm becoming increasingly concerned that the economy may be getting too strong for the Fed's liking,'' said Joseph Quinlan, who helps manage $457 billion as chief market strategist at Bank of America Capital Management in New York. ``If you get a blowout number on the jobs data tomorrow, we increase the odds of the Fed not being done in May.''

OK, then, on to tomorrow.