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U.S. Worker Productivity Climbs

Wall Street Journal (11/14/13) Eric Morath; Josh Mitchell

According to the U.S. Department of Labor, labor productivity increased at a 1.9% annual rate from July through September. Productivity had increased rapidly early in the recession but has since slowed. Productivity rose along with investments in equipment and technology, which have also slowed. Unit labor costs declined at a 0.6% annual rate in the third quarter, but are up 1.9% year-to-year.

Job creation and hourly wages increased in October, and output increased by an annualized 3.7% in the third quarter. If companies continue to add jobs but output does not increase more quickly, productivity will slow. Many economists expect a slowdown during the fourth quarter.