It turns out that nonfarm productivity managed to post a small gain in the second quarter of 2015. While that gain was smaller than expected, there may be some relief here that productivity went back up. This second-quarter reading was up by 1.3%, short of the 1.6% consensus estimate from Bloomberg. Output rose by 2.8% and hours rose by 1.5%.

Another boost is that the first-quarter reading, which had faced criticism just like the first-quarter gross domestic product report has faced, was revised to -1.1% from a much worse prior reading of -3.1%.

The gain in output and productivity led unit labor costs to a gain of 0.5% in the second quarter, right in line with the 0.5% consensus reading from Bloomberg. Unit labor costs in the first quarter were revised lower to 2.3% from a prior reading of 6.7%.

If you look at this on a year-over-year basis, rather than quarter over quarter, the overall nonfarm productivity was up by only 0.3% and unit labor costs were up by 2.1%. Also year over year, output was up 2.8% and hours worked was up 2.6%.

These two reports are unlikely to move the markets much, and news that China devalued the yuan to boost its exports and to slow its imports will not be much of a help. The Bureau of Labor Statistics reported the following sector and industry data:

Manufacturing labor productivity increased 2.5 percent in the second quarter of 2015, as output increased 1.5 percent and hours worked decreased 1.0 percent. Productivity increased 3.4 percent in the durable manufacturing sector and 1.2 percent in the nondurable goods sector. Over the last four quarters, manufacturing productivity increased 1.1 percent, as output increased 2.3 percent and hours increased 1.2 percent. Unit labor costs in manufacturing decreased 2.3 percent in the second quarter of 2015 and increased 0.2 percent from the same quarter a year ago.

S&P 500 futures were down 18 points and Dow futures were down about 160 points or so ahead of the open, and the situation had not changed much by late morning.

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