Job seekers break out to visit corporate employment personnel at a U.S. Chamber of Commerce Foundation "Hiring Our Heroes" military job fair in Washington.
Washington: U.S. unit labor costs rebounded less than initially thought in the third quarter and the decline in the prior period was sharper than previously estimated, suggesting moderate growth in wage inflation.
The Labor Department said on Thursday that unit labor costs, the price of labor per single unit of output, rose at a 0.9 percent annualized rate, instead of increasing at a 1.2 percent pace as reported last month.
Unit labor costs in the April-June period declined at a 2.8 percent rate, the largest drop since the second quarter of 2014. Unit labor costs were previously reported to have dropped at a 1.0 percent pace in the second quarter.
Unit labor costs rose a downwardly revised 0.9 percent rate compared to the third quarter of 2017. They were previously reported to have increased at a 1.5 percent pace on a year-on-year basis.
Though wage growth has picked up in recent months, the unit labor costs data suggests a burst in wage inflation is unlikely. There has not been a rapid increase in wages even as the unemployment rate has dropped to near a 49-year low of 3.7 percent.
The increase in hourly compensation in the third quarter was revised down to a 3.1 percent rate from the 3.5 percent rate reported last month.
Worker productivity increased at a revised 2.3 percent annualized rate rather than the 2.2 percent estimated last month. Productivity grew at a 3.0 percent rate in the second quarter.