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Rising unit labor costs suggest that cost push inflation is at work in the economy provided that output per hour is not keeping pace with unit labor cost growth. In this study, I look at the long term trends in both metrics over the period 2005-2015. I also look at the output per hour and unit cost trends for the period 2009-2015 to see if the 2008 recession impacted these cost and output trends. If output per hour is rising faster than unit costs. Productivity at the margin is increasing and cost push inflation is declining. If the converse is true, cost push inflation is rising in the national economy. Both quarterly and yearly geometric growth rates in both cost and output metrics are calculated for the above time periods. The geometric growth rates are then used to determine the direction of cost push inflation.

Publication Date


Project Designation

Independent Research

Primary Advisor

Trevor C Collier

Primary Advisor's Department

Economics & Finance


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Output per Hour and Unit Labor Cost; A Closer Look at Cost Push Inflation, 2005-2015