Such pay rises as there have been are being eclipsed by rising productivity: unit labour costs actually fell in the second half of 1999.
Falling productivity pushes up unit-wage costs, hurting profits and cashflow.
Time Warner posted strong fourth quarter earnings on Wednesday as the company capitalized on the continued success of Harry Potter and the Deathly Hallows Part 1, growth in networks stemming from advertising and subscription growth in HBO and TVS, and improved productivity in its publishing unit, Time Inc.
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What really matters for jobs and competitiveness is not consumer price inflation, but the rate of change of unit labor costs. (Unit labor costs are wage rates adjusted for changes in productivity.) A recent study from the Boston Consulting Group suggests that Chinese unit labor costs will grow at about 8.5 percent per year over the next five years.
Italy and Spain have seen sharp rises in unit labour costs and their labour-productivity growth has stalled or gone into reverse.
Part of this rise in pay has been offset by strong productivity growth, but even unit wage costs are rising more rapidly.
And today's report on productivity and expenses showed that unit labor costs grew 4.2% from the first quarter, above the consensus of 3.8%--nearly four times the growth rate of productivity.
And today's government report on productivity and costs showed that unit labor costs grew 4.2% from the first quarter, above the consensus of 3.8% and much faster than the growth rate of productivity, which increased 1.1%, way below the 4.3% pace of last quarter.
Recent indicators showing falling productivity and a rapid increase in unit labor costs suggest the pressure is building.
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For the full year, nonfarm productivity increased about 1 percent and unit labor costs rose 0.7 percent, the government said.
Corporate profits, he noted, have risen sharply since the third quarter of last year, thanks in part to a big jump in productivity and to a decline in unit labour costs.
China still has perhaps 200m underemployed rural workers who could move to factories over the next two decades, so wages for low-skilled workers are rising more slowly than productivity, reducing China's unit labour costs.
These are hardly excessive growth rates in normal times, much less in an economy with almost 10 percent unemployment, with capacity utilization down from the 80s to the 60s, and with nonbank credit sinking, productivity growing rapidly, and with unit labor cost declining.
Moreover, so long as productivity is rising, firms can cut unit labour costs even without pay cuts.
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At the same time, productivity rose 3.9% while unit labor costs fell 1.5%.
After all, 2010 productivity rose 3.9% while unit labor costs fell 1.5%.
Both increase productivity, which is higher output per unit of labor input.
Within the euro, it has suffered a big loss of competitiveness as unit labour costs have shot up, largely because productivity has been stagnant or even fallen.
Unit labour costs will rise as wages improve and productivity growth slows. (Productivity growth already seems to be slowing a bit in America.) Alternatively, the naturally buoyant spirits of corporate book-keepers will eventually catch up with them, and firms will make another round of massive write-offs laying the ground for another few years of booming profits.
As productivity rose wages did not, thus lowering unit labour costs over time.
In 2010, productivity was up 3.9% while unit labor costs fell 1.5%.
The Fed said that core inflation was increasing but that productivity gains have held down the rise in unit labor costs.
Wages were thus deliberately repressed: there were some real wage cuts but the majority of that cut in unit labour costs came from the normal ongoing rise in productivity.
It is the combination of poor productivity growth and rising wages that has caused Italy's unit labour costs to rise so much faster than those in other euro members in the seven years since the euro started.
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According to the Economist Intelligence Unit, a sister company of The Economist, Nissan Sunderland has the highest productivity of any car plant outside Asia.
Due to the permanent gains in worker productivity a firm will likely require fewer employees to support an additional unit of revenue growth than it had in the past.
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We earned their business and achieved what we set out to achieve: unit volume growth in our core crops, a successful implementation of our agricultural productivity strategy and sustained cost-discipline across our operations.
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He believes that positive supply-side forces will continue to damp the impact of strong demand on output prices and that productivity gains will continue to damp the effect of higher wages on unit labor costs.
We define cash productivity as the amount of free cash flow that a retailer produces per unit of retail space.
And in dollar terms, given the loss of productivity suffered by the Brazilian economy given substantial appreciation in their currency, unit labor costs have grown by 110% since 2005. (Read No Credit Bubble In Brazil, Just Dangerous Consumer Debt Burden).
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