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The Labor Department said on Wednesday
productivity expanded at a 2.3 percent annual rate instead of
the previously reported 2.0 percent pace.
Economists polled by Reuters had expected productivity, which
measures hourly output per worker, would be raised to a 2.4
percent rate to reflect upward revisions to third-quarter gross
domestic product.
The government last week raised third-quarter GDP growth to a
3.9 percent pace from a 3.5 percent rate.
The trend in productivity, however, remains relatively weak,
despite the upward revision. Productivity rose 1.0 percent
compared to the third quarter of 2013.
Businesses have been hiring more workers to increase
productivity, helping to put a dent in unemployment.
Compensation measures were revised sharply lower in line with
downward revisions to income data published last week.
Unit labor costs, the price of labor for any given unit of
production, fell at a 1.0 percent rate in the third quarter.
They had previously been reported to have increased at a 0.3
percent pace.
Unit labor costs for the second quarter were also revised down
to show them declining at a steeper 3.7 percent rate instead of
the previously reported 0.5 percent pace.
That should ease fears that wage growth is rising a little bit
faster than the Fed's expectations and cause the U.S. central
bank to wait longer to raise interest rates.
Wage growth is one of the key factors that will determine when
the Fed will start raising its short-term interest rate, which
it has kept near zero since December 2008.
Compensation per hour increased at a 1.3 percent rate in the
third quarter rather the 2.3 percent pace reported last month.
Compared to the third quarter of last year, hourly compensation
rose 2.2 percent instead of the 3.3 percent advance reported
last month.
(Reporting by Lucia Mutikani; Editing by Paul Simao)
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