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The Labor Department said on Thursday nonfarm productivity,
which measures hourly output per worker, increased at a 2.2
percent annualized rate in the last quarter.
Data for the second quarter was revised slightly up to show
productivity rising at 3.0 percent pace instead of the
previously reported 2.9 percent rate. Growth in second-quarter
productivity was the strongest since the first quarter of 2015.
Economists polled by Reuters had forecast third-quarter
productivity advancing at a 2.2 percent rate, following a
moderation in gross domestic product growth for that period. The
economy grew at a 3.5 percent rate in the July-September period
after a robust 4.2 percent pace in the second quarter.
Compared to the third quarter of 2017, productivity increased at
a rate of 1.3 percent. Productivity grew at an average rate of
1.3 percent between 2007 and 2017. That was slower than the 2.7
percent average pace between 2000 and 2007.
Sluggish productivity is one of the constraints to keeping the
economy on a path of strong growth on a sustained basis.
Unit labor costs, the price of labor per single unit of output,
rebounded at a 1.2 percent pace in the third quarter. Unit labor
costs in the April-June period declined at a 1.0 percent rate,
which was the largest drop since the third quarter of 2014.
Labor costs increased at a 1.5 percent rate compared to the
third quarter of 2017.
Despite moderate growth in labor costs, wage growth is picking
up. Hourly compensation jumped at a 3.5 percent rate in the
third quarter after rising at a 1.9 percent pace in the
April-June period. Hourly compensation increased at a 2.8
percent rate compared to the third quarter of 2017.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
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