Updated: 29-Jan-26 09:35 ET
| Q3 Productivity-Prel |
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| Updated: 29-Jan-26 09:35 ET |
Highlights
- The revised Q3 productivity report didn't contain any new surprises or changes. The growth rate for Q3 productivity remained at an impressive 4.9% (Briefing.com consensus: 4.9%).
- Unit labor costs decreased 1.9% (Briefing.com consensus: -1.9%), unchanged from the advance report.
Key Factors
- The increase in productivity was the result of output increasing 5.4% and hours worked increasing 0.5%. From the same quarter a year ago, nonfarm business sector labor productivity increased 1.9%.
- The increase in unit labor costs stemmed from a 2.9% increase in hourly compensation and a 4.9% increase in productivity.
- Manufacturing sector labor productivity increased 3.7%, as output increased 3.0% and hours worked decreased 0.7%. Unit labor costs in the total manufacturing sector increased 1.1%, driven by a 4.8% increase in hourly compensation and a 3.7% increase in productivity.
Big Picture
- With no changes, the key takeaway remained the same: this productivity report is the golden ticket for the economy (and the Fed, per chance), as it reflects strong growth without labor cost inflation.
| Category | Q3 | Q2 | Q1 | Q4 | Q3 |
| Nonfarm Business Sector | |||||
| Productivity Q/Q | 4.9% | 4.1% | -2.1% | 0.9% | 3.1% |
| Unit Labor Costs Q/Q | -1.9% | -3.0% | 6.9% | 3.8% | -1.5% |
| Productivity Y/Y | 1.9% | 1.5% | 1.2% | 1.9% | 2.6% |
| Unit Labor Costs Y/Y | 1.2% | 2.0% | 3.0% | 2.6% | 2.2% |