More Bad News from Labor Dept.

• June 6, 2012 12:17 pm


The U.S. saw productivity decline in the first three months of 2012, lending credence to former President Bill Clinton’s assertion that the economy is still in recession.

The Bureau of Labor Statistics found that productivity fell by about 1 percent during the first quarter of 2012. Productivity is the measure of employee output to hours worked, and it has been one of the few statistics to hold steady during the recession as companies scraped by with fewer workers. The decline indicates the economy is still struggling to recover. In comparison, the first quarter of 2011 saw an increase in productivity of 0.4 percent.

The announcement stands in stark contrast to typical economic trends, in which increased unemployment begets higher productivity. In addition to the drop in productivity, unemployment ticked up to 8.2 percent in May, leading to financial panic on Wall Street and predictions of continued stagnation.

On Tuesday Bill Clinton called on President Barack Obama to extend tax cuts in order to speed up the recovery and avoid falling off the "fiscal cliff."

"I don't have any problem with extending all of it now, including the current spending level. They're still pretty low, the government spending levels. But I think they look high because there's a recession," he told CNBC. "So the taxes look lower than they really would be if we had two and a half, 3% growth."