U.S. workers’ productivity increased in the third quarter and labor costs declined, the Labor Department said Wednesday, raising an earlier productivity estimate.
The 2.3% gain in productivity, which was revised from an earlier 3.1% estimate, followed back-to-back declines in the previous two quarters.
Productivity is a measure of how much an employee produces for every hour of work.
Economists had forecast a 2.5% increase, Bloomberg reported. Labor costs declined 2.5%, more than the 2.1% 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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