2022 Fourth Quarter (Preliminary) Productivity and Costs — 2023-02-02

Nonfarm business sector labor productivity increased 3.0 percent in the fourth quarter of 2022, the U.S. Bureau of Labor Statistics reported today, as output increased 3.5 percent and hours worked increased 0.5 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the same quarter a year ago, nonfarm business sector labor productivity decreased 1.5 percent, reflecting a 0.8-percent increase in output and a 2.3-percent increase in hours worked. (See table A1.) Annual average productivity decreased 1.3 percent from 2021 to 2022. This is the largest annual decline in the measure since 1974, when productivity decreased 1.7 percent. (See table C1.) Unit labor costs in the nonfarm business sector increased 1.1 percent in the fourth quarter of 2022, reflecting a 4.1-percent increase in hourly compensation and a 3.0-percent increase in productivity. Unit labor costs increased 4.5 percent over the last four quarters.