American workers more than doubled their productivity gains in the April-June quarter over the preceding three months, but ended up with less real pay and benefits, the Labor Department said yesterday.
An upturn in inflation meant that real hourly compensation for business workers fell at a 1.7 percent annual rate in the quarter, the government said. The rate shows how much the change would be if every quarter in 1987 were like the April-June period and if seasonal factors were taken into account.
The AFL-CIO said the report shows that businesses are not willing to share the benefits of increased productivity. Business spokesmen responded that working harder does not necessarily convert to higher pay in a world where people elsewhere will work for less.
The 1.3 percent rise in the business productivity rate is more than double the 0.6 percent gain recorded in the first quarter. The government attributed the gain to a rise of 3 percent in output, although the number of hours needed to produce those goods increased only 1.7 percent.
The nonfarm business sector showed a 1.4 percent increase, the government said.
Manufacturers' productivity jumped 3.3 percent. Makers of durable goods -- autos, hardware and such items meant to last three years or longer -- pushed ahead at a 2.9 percent rate, while nondurable goods makers improved their productivity at a 4.2 percent rate.
Workers' hourly compensation grew at a 3.2 percent annual rate during the quarter, compared with a 1.4 percent pace in the first three quarter. Compensation includes supplements, benefits and taxes paid on workers as well as wages and salaries.
But with the effects of inflation, the hourly compensation figure converted to a 1.7 percent annual decline, the government said. The first quarter's annual rate of decline was 3.7 percent.
Rudy Oswald, chief economist for the AFL-CIO, said compensation has risen far less quickly than it should have considering that Americans lately have posted some of the world's best increases in productivity. "One sees that stockholders are doing well, and top corporate executives are doing well," he said. "It seems the ones who are asked to bear all the costs are workers."
But Bonnie Ohri, an economist with the Chamber of Commerce of the United States, said productivity gains alone are not enough to justify pay raises.
"It depends what the scale is for that kind of work and what price it's going to get in the market," she said. And in an age that sees U.S. goods competing worldwide, that means business must take on companies in other parts of the world where workers get paid much less than Americans.
Jerry Jasinowski of the National Association of Manufacturers said he believes that if current productivity gains continue, workers will benefit in the long run. He noted that much of this year's inflation has been caused by a run-up in oil prices, a trend he does not expect to continue.
But Sara Johnson of the economic forecasting firm Data Resources Inc. in Lexington, Mass., said tough times for workers probably will continue.
"For factory workers it appears wage gains for the rest of the year will not keep pace with inflation," she said. "But with the manufacturing sector improving, perhaps there'll be more opportunity to work overtime and get ahead that way."