Higher Wages + Lower Productivity = Inflation? (U.S.)

The U.S. Labor Department reported:

• July - September U.S. labor costs rose 3.8%
• Wages and labor costs are up 5.3% over the last year, which is the highest increase since 1982
• Unemployment claims up to highest level in three months. They slowing economy may be pushing companies to lay off workers

Martin Crustsinger, AP Economics writer states, "The concern is that with productivity gains slowing over the past year and the cost of labor rising, these trends could make the Fed's job of keeping inflation under control more difficult."

Productivity slows to a standstill. [U.S. Labor Department, AP - Martin Crutsinger]

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