U.S. Worker Productivity Jumps to 8.1% Rate

U.S. workers’ productivity surged in the third quarter to an annual rate of 8.1%, increasing at the fastest in six years, the Labor Department said Thursday.

The rate followed an originally reported 6.4% rate in the second quarter, Labor said.

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

The level was lower than economists’ forecasts of an 8.5% annual rate, Bloomberg reported.

Among manufacturers, productivity rose at a 13% rate, the largest increase since records began in 1987.

Labor costs fell at a 2.5% rate, capping the biggest 12-month drop in seven years.

Productivity rose 4% compared with last year’s thirdquarter, the biggest year-over-year increase in five years, Bloomberg reported.

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.