Although probably further depressing for the job market. Productivity increased at a 2.7% rate last quarter, while per unit labor costs declined at a rate of 1.3%. Productivity is probably the single most important determinant in standard of living. Per unit costs had been increasing through the recession, and began decreasing at the start of 2002, contributing to the recovery. Unfortunately, as long as workers are more productive, fewer of them are needed. Fortunately, these adjustments tend to make jobs more secure in the long run, too.

What's really funny are the "consensus" numbers. These numbers, for just about any market-moving stat, are important. The market will have, to some extent, figured these expectations into its prices already. Barron's lists the consensus productivity number at 3.0%, meaning that productivity increased just a little more slowly than expected. Likewise, "economists expected" per unit labor costs to rise at an annual rate of 0.2%, essentially flat. Their decline supposedly surprised the consensus.

But the consensus range is so broad, the analysts may as well have been playing darts in a pitch-black room with blindfolds on. They're lucky they didn't put someone's eye out, but it's hard to see what difference it would make if they had. The "consensus" ranges from 1.9% to 7.0% on productivity, and from -2.0% to 1.5% on labor costs. This is like saying that the Lakers will win the title, unless they don't.