Faster productivity growth in the U.S. economy provides many benefits such as faster wage growth without adding to inflationary pressures. It also hinges on a few key factors such as public infrastructure investments and private business investments in updated facilities and new technologies. The U.S. economy has seen an acceleration in productivity growth – how output per hour has changed – over the past year. This is atypical for this stage in a business cycle. That is, productivity growth has unexpectedly accelerated. This acceleration could reflect recent trends in public and private investments as well as in employment. Given that these trends have continued, albeit in slightly different forms, there is a good chance that productivity growth will continue at a healthy pace.
Faster Productivity Growth At The Heart Of Rising Living Standards
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