Worker productivity sees slight rise

Budget cuts and sequestration are putting tens of thousands of shipyard workers at risk of losing their jobs. Wyatt Andrews reports the Navy's planned budget cuts of $10.3 billion will fall hardest in Virginia shipyards and involve the cancellation of 22 ship repairs and modernizations.

WASHINGTON U.S. worker productivity barely grew from January through March after shrinking in the final three months of 2012. Weak productivity growth could prompt employers to hire more if consumers and businesses continue to increase spending.

The Labor Department says productivity rose at a seasonally adjusted annual rate of 0.7 percent in the first quarter, after shrinking 1.7 percent in the previous quarter.

Labor costs increased at a seasonally adjusted annual rate of 0.5 percent, below the fourth quarter's 4.4 percent gain.

Productivity is the amount of output per hour of work. It increased because output rose at a faster pace than hours worked.

Productivity has been under 1 percent since 2010 and well below the long-run trend of 2.2 percent growth a year dating back to 1947.