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U.S. Worker Productivity Surges 3.6% in Third Quarter as Labor Costs Unexpectedly Decline
Hours worked rose just 0.1% as unit labor costs fell 0.7%, suggesting productivity gains are easing inflation pressure, the Bureau of Labor Statistics said.
- The Bureau of Labor Statistics reported on Nov. 5 that nonfarm productivity increased at an annualized rate of 3.6 percent in the third quarter, surpassing the 2.8 percent consensus forecast.
- Federal Reserve officials may welcome this data, as stronger productivity helps ease inflation pressures without weakening the labor market. Unit labor costs fell by 0.7 percent, indicating no current inflation threat from workers.
- Policymakers and economists generally believe new technology will ignite a productivity boom, a view Fed Chairman Kevin Warsh reiterated to International Monetary Fund Director Kristalina Georgieva in recent discussions.
- Workers have yet to experience the benefits of higher productivity, according to Adrian Balfour of Envorso. Established companies use AI to enhance output, while startups expand without hiring at the same pace.
- "We really don't know what the market structure will be for these new technologies," Warsh said. The Penn Wharton Budget Model estimated last year that AI would boost productivity and gross domestic product by almost 3 percent by 2055.
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U.S. Worker Productivity Surges 3.6% in Third Quarter as Labor Costs Unexpectedly Decline
American businesses recorded their strongest productivity growth in a year during the third quarter, exceeding economists' expectations and easing labor cost pressures despite persistent inflation ... The post U.S. Worker Productivity Surges 3.6% in Third Quarter as Labor Costs Unexpectedly Decline first appeared on [your]NEWS.
U.S. workers’ productivity grew faster than expected in the third quarter
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C 57%
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