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August 9, 2002 9:15 AM, EDT

The productivity of U.S. workers rose at an annual pace of 1.1% in the second quarter, the Labor Department reported Friday.

The rise was 4.7 % higher than in the same period in 2001 and outstripped the expectations of economists who had predicted a 0.6% annualized rate in the second quarter, Bloomberg reported.

However, the second-quarter increase followed an 8.6% jump in the first quarter, reflecting, Bloomberg said, cooler economic growth.

The productivity figures, including a revised 1.1% pace for 2001, reflect the response of companies to slowing demand, Bloomberg said. As payrolls are reduced faster than production, remaining employees are statistically more efficient.

Fed Chairman Alan Greenspan told Congress last month that the productivity gains would not have been possible without technological advancement and from heavy investment in equipment in the latter half of the 1990s, Bloomberg said.