2021 Third Quarter (Revised) Productivity and Costs — 2021-12-07

Nonfarm business sector labor productivity decreased 5.2 percent in the third quarter of 2021, the U.S. Bureau of Labor Statistics reported today, as output increased 1.8 percent and hours worked increased 7.4 percent. This is the largest decline in quarterly productivity since the second quarter of 1960, when the measure decreased 6.1 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the third quarter of 2020 to the third quarter of 2021, nonfarm business sector labor productivity decreased 0.6 percent. This four-quarter rate is the largest decline since the fourth quarter of 1993, when the measure also declined 0.6 percent. (See table A1.) Unit labor costs in the nonfarm business sector increased at an annual rate of 9.6 percent in the third quarter of 2021, reflecting a 3.9-percent increase in hourly compensation and a 5.2-percent decrease in productivity. Unit labor costs increased 6.3 percent over the last four quarters.