US worker productivity picked up pace in the third quarter, although by less than expected, the Labour Department said today Non-farm labour productivity increased by a 4.0pc annual rate in the three months to September, up from 1.7pc in the second quarter. The gain is a positive signal for the economy, although it fell short of the 4.8pc rate expected. However, on a year-on-year basis, productivity rose 5.3pc, the largest year-on-year increase since the first quarter of 1973.
In a speech at a Labour Department conference last month, Fed chairman Alan Greenspan was upbeat in his comments on US productivity, saying that the growth that began in the latter part of the 1990s has not yet faltered as yet. "It is both remarkable and encouraging that, despite all that has transpired over the past couple of years, a significant step-up in the growth of productivity appears to have persisted," he said Unit labour costs for non-farm business, a figure closely followed for signs of inflation pressures, rose 0.8pc in the quarter, down from 2.2pc in the second quarter. On a year-on-year basis, costs fell 2.2pc //www.fxcentre.com