Keeping you up to date on the latest data releases.
- Productivity and Costs
Nonfarm business sector productivity—real output per hour of all persons—grew at an annualized rate of 2.3 percent in the third quarter, following a downward revision from a 3.1 percent increase. The revision reflects reduced output growth, which had its estimate fall from 3.8 percent to 3.2 percent, and higher growth in hours worked, which is now estimated to be 0.8 percent. Hourly compensation was revised down for the third quarter as well, from a 0.6 percent increase to a 0.2 percent decline. An even larger downward revision was made to second quarter hourly compensation, showing that the series declined 0.2 percent rather than having increased 2.7 percent. After adjusting for price changes, real hourly compensation was revised down 0.8 percentage points in the third quarter and 2.8 percentage points in the second quarter. The third-quarter decline in hourly compensation nearly offset the decline in productivity, leaving unit labor costs relatively unchanged at a 2.5 percent drop. However, unit labor costs in the second quarter were dragged down by the drop in hourly compensation, as the second quarter estimate fell from a 2.8 percent increase to a 0.1 percent decline. On a year-over-year basis, unit labor costs were revised from 1.2 percent growth to just 0.4 percent.