Labor Productivity Up 2.9%, Costs Down 1.9%
Americans are working and producing more at less cost, according to a U.S. Department of Labor report [link opens in PDF] released today. Nonfarm business sector labor productivity increased at a seasonally adjusted quarter-over-quarter 2.9% annual rate for the third quarter of 2012, while unit labor costs dropped 1.9%.
Labor productivity is a measure of output and hours worked, which increased 4.2% and 1.3%, respectively. Compared to Q3 2011, productivity increased 1.7%, with output and hours worked measuring gains of 3.5% and 1.8%, respectively. Overall productivity results squeaked in ahead of analysts' 2.8% expected rise.
While labor costs dropped, hourly compensation rose 0.9% and unit labor costs for the last four quarters remained nearly flat with a 0.1% rise . Analysts had expected a 0.9% drop in unit labor costs for Q3 2012.
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