Keeping you up to date on the latest data releases.
- Productivity and Costs
Nonfarm business sector productivity—real output per hour of all persons—increased at an annualized rate of 1.9 percent during the third quarter. This follows a similar increase of 1.9 percent in the second quarter (revised down from 2.2 percent), and a decline of 0.5 percent during the first three months of the year. Over the last four quarters, nonfarm business sector productivity has increased 1.5 percent. The rise in productivity came from an increase in output of 3.2 percent during the third quarter, which was partially offset by a 1.3 percent increase in hours. Over the past twelve months, output and hours have increased 3.3 percent and 1.8 percent, respectively. Following increases of 5.8 percent and 3.6 percent in quarters one and two, hourly compensation increased at a rate of 1.8 percent in the third quarter and is up 2.6 percent since the third quarter of 2011. However, after controlling for price changes, “real” hourly compensation fell 0.4 percent in quarter three after increasing in the first two quarters this year. Unit labor costs, which are measured as hourly compensation per hourly output and are an indicator of inflationary pressure coming from wages, were basically flat in the third quarter, decreasing 0.1 percent. On a year-over-year basis, unit labor costs are up 1.1 percent.