Unit Labor Costs On The Rise As Productivity Declines

Washington, D.C. – Unit labor costs in the nonfarm business sector of the United States increased by an annualized 9.6 percent in the third quarter of 2021, compared to initial estimates of an 8.3 percent increase and an upwardly revised 5.9 percent increase in the previous period.

It reflects a 3.9 percent increase in hourly pay and a 5.2 percent drop in productivity.

Over the last four quarters, unit labor costs increased by 6.3 percent, rather than the previously reported 4.8 percent, as hourly compensation increased by 5.8 percent and productivity fell by 0.6 percent.