WASHINGTON—U.S. productivity grew at a solid 3.6% rate in the first three months of this year, the strongest quarterly gain in more than four years and a hopeful sign that a long stretch of weak productivity gains may be coming to an end.
The first quarter increase in productivity was more than double the 1.3% rate of gain in the fourth quarter, the Labor Department reported May 2. Labor costs actually fell in the first quarter, dropping at an annual rate of 0.9%, indicating that tight labor markets are not creating unwanted wage and inflation pressures.
