US productivity up 1.7% in 2019, best gain in 9 years


US productivity rises 1.4% in Q4 and gains 1.7% for all 2019, best showing since 2010

U.S. productivity rebounded in the final three months of last year, helping to boost productivity growth for the year to the best showing in nearly a decade.

The Commerce Department said Thursday that productivity grew at an annual rate of 1.4% in the October-December quarter, a significant improvement from a 0.2% drop in productivity in the third quarter.

For the year, productivity increased 1.7%, up from gains of 1.3% in both 2018 and 2018. While a 1.7% rise in productivity is considered modest, it was the best annual showing since a 3.4% advance in 2010.

Labor costs rose 1.4% in the fourth quarter, a slowdown from a 2.5% jump in the third quarter. For the year, labor costs rose 2%, up from a 1.8% gain in 2018.

Productivity, a key factor needed to boost living standards, has been lagging for most of this record-long expansion, now in its 11th year. But economists believe there are some signs at least that productivity may finally be starting to improve.


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