Fourth-Quarter Productivity Rises 1.8%

U.S. worker productivity rose at an annual rate of 1.8% in the fourth quarter, the Labor Department said Wednesday.

The productivity rate followed a revised 6% rate in the third quarter, Labor said.

The level topped economists’ estimates of a 0.5% third-quarter rate, Bloomberg reported.

Productivity is a measure of how much an employee produces for every hour of work.

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.