Preliminary Q3 Non-Farm Productivity Up 1.9%; Labor Costs Drop 0.6%

WASHINGTON — Preliminary Q3 nonfarm productivity was reported up 1.9%, after a 1.8% increase in Q2, and near the 1.5% 2012 gain.

Productivity was enhanced in Q3 because output was up 3.7% but hours were up a lesser 1.7%.

Unit labor costs were down 0.6% in a positive development for corporate profits. These costs were down because durable manufacturing costs posted a 0.4% decline, perhaps reflecting a lack of overtime as hours slowed over the period.

ULC rose 1.2% in 2012 and it is possible that bonus and other income in the final period of 2013 also will lift the total.

Recent productivity numbers remain low, however. The 1947-2012 average gain in nonfarm productivity was up 2.2%, and the average gain in the 2000-2011 period was a slightly higher 2.4% increase.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.

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