Productivity Up, Labor Costs Down, & ADP Might Not Be As Bad As It Seems

Productivity was revised up slightly for 2Q09 to +6.6% from +6.4%, while unit labor costs were revised down to -5.9% from -5.8%.  Additionally, the ADP employment survey indicated a loss of -298K jobs, compared to -360K last month.  This was worse than analyst’s estimates.  Nevertheless, the details behind the ADP report, like the rest of the sector continue to demonstrate well-rounded improvements.  In fact every category of the report, excluding small goods producing companies, showed a smaller decline from the previous month.  The market reacted adversely to the release, but the real story may be the improvements behind the headline.

Finally, I must apologize I will be moving office locations today, and will only have intermittent access to my computer for real-time updates.