Financial News: U.S. Labor Productivity Growth Slows Much Less Than

U.S. Labor Productivity Growth Slows Much Less Than Expected In Q4

03/05/2026 - 10:38:00 (RTTNews)

(RTTNews) - Labor productivity in the U.S. surged by much more than expected in the fourth quarter of 2025, according to a report released by the Labor Department on Thursday.

The Labor Department said labor productivity shot up by 2.8 percent in the fourth quarter after soaring by an upwardly revised 5.2 percent in the third quarter.

Economists had expected labor productivity to jump by 1.9 percent in the fourth quarter compared to the 4.9 percent spike that had been reported for the previous quarter.

The bigger than expected increase in productivity, a measure of output per hour, came as output surged by 2.6 percent and hours worked edged down by 0.2 percent.

"Judging by recent trends in the data, US productivity growth continues to outstrip its advanced economy peers - a structural tailwind for its growth," said Nationwide Financial Market Economist Oren Klachkin.

He added, "We continue to look for solid productivity gains in 2026 as output growth outpaces employment."

The report said unit labor costs also jumped by 2.8 percent in the fourth quarter after tumbling by a revised 1.8 percent in the third quarter.

Unit labor costs were expected to shoot up by 2.1 percent compared to the 1.9 percent slump that had been reported for the previous quarter.

The bigger than expected rebound by unit labor costs came as hourly compensation spiked by 5.7 percent in the fourth quarter, more than offsetting the surge in productivity.

Real hourly compensation, which takes changes in consumer prices into account, shot up by 3.1 percent during the quarter.

For comments and feedback: contact editorial@rttnews.com

Market News provided by RTTNews

RECENT INTERNATIONAL FINANCIAL NEWS

Treasury Announces Details Of Long-Term Securities Auctions (37 min(s), 05 sec(s) ago)
(RTTNews) - The Treasury Department on Thursday revealed the details of this month's auctions ...Full Story»

U.S. Labor Productivity Growth Slows Much Less Than Expected In Q4 (01 hr(s), 13 min(s), 05 sec(s) ago)
(RTTNews) - Labor productivity in the U.S. surged by much more than expected in the fourth quarter ...Full Story»

U.S. Import Prices Rise 0.2% In January, Slightly More Than Expected (01 hr(s), 40 min(s), 05 sec(s) ago)
(RTTNews) - A report released by the Labor Department on Thursday showed import prices in the U.S. ...Full Story»

U.S. Jobless Claims Unchanged At Slightly Upwardly Revised Level (01 hr(s), 54 min(s), 05 sec(s) ago)
(RTTNews) - A day ahead of the release of the more closely watched monthly jobs report, the Labor ...Full Story»

Hungary Retail Sales Growth Remains Stable At 3.5% (03 hr(s), 06 min(s), 05 sec(s) ago)
(RTTNews) - Hungary's retail sales expanded at a steady pace in January, preliminary figures f ...Full Story»

U.S. Labor Productivity Jumps Much More Than Expected In Q4 (03 hr(s), 08 min(s), 05 sec(s) ago)
(RTTNews) - Labor productivity in the U.S. surged by much more than expected in the fourth quarter ...Full Story»

U.S. Import Prices Rise Slightly More Than Expected In January (03 hr(s), 13 min(s), 05 sec(s) ago)
(RTTNews) - A report released by the Labor Department on Thursday showed import prices in the U.S. ...Full Story»

U.S. Weekly Jobless Claims Unchanged At 213,000 (03 hr(s), 17 min(s), 05 sec(s) ago)
(RTTNews) - A day ahead of the release of the more closely watched monthly jobs report, the Labor ...Full Story»