U.S. workers’ productivity slowed in the second quarter and labor costs rose, the Labor Department said Tuesday.
The 0.3% decrease in productivity followed a revised 0.6% decline the previous three months that was previously reported as a 1.8% gain.
Productivity is a measure of how much an employee produces for every hour of work.
Economists had forecast a 0.9% decrease, Bloomberg reported. Labor costs rose 2.2%, less than the 2.4% forecast, Bloomberg said.
When worker efficiency improves at a slower pace and labor becomes more expensive, companies may raise prices in order to guard their profits, contributing to more rapid inflation.
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