US worker productivity grew 3 percent over the summer as output rose; labor costs fall

Published January 13, 2015

U.S. workers boosted their productivity from July through September at the fastest pace since the end of 2009, adding to signs of stronger growth.

The Labor Department says productivity increased at a 3 percent annual rate in the third quarter. That's up from an initial estimate of 1.9 percent and much stronger than the 1.8 percent rate from April through June.

Productivity rose because economic growth was much stronger than previously estimated in the third quarter. Productivity is the amount of output per hour of work.

Labor costs fell in the third quarter, evidence that inflation will remain low.

Higher productivity enables companies to pay employees more without sparking inflation. But greater productivity can also slow hiring if it shows companies don't need more workers to boost output.

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