Output per hour in the nonfarm business sector was revised up to a 2.3% gain at a seasonally adjusted annual rate in Q3'18 (1.3% year-over-year), from the previously reported 2.2% increase. In Q2 productivity growth remained at a 3.0% rate. The consensus from the Action Economics Forecast Survey looked for a Q3 gain of 2.3%. Third quarter output and hours worked were unrevised at 4.1% (3.7% y/y) and 1.8% (2.3% y/y) respectively.

Unit labor costs were revised substantially lower to 0.9% in Q3 from 1.2% and -2.8% in Q2 (was -1.0%). These changes decreased the third quarter year-on-year gain to 1.2% from 1.5%. A 1.0% quarterly pace in Q3 had been expected by the Action Economics survey. These revisions were predominantly the result of slower compensation growth for both quarters: 3.1% (2.2% y/y) in Q3 and flat in Q2.

In the manufacturing sector, productivity was revised meaningfully higher to a 1.0% annualized gain Q3 (was 0.5%) and 1.4% y/y. The Q2 reading was unchanged at 1.2%. Output increased at an upwardly revised 4.1% pace in Q3 (3.6% y/y), while hours worked grew a slightly faster 3.1% (2.1% y/y).

Unit labor costs in the factory sector declined at a 1.2% rate in Q3 (-1.2% y/y), following a 6.1% drop. Compensation per hour edged down 0.2% (+0.2% y/y) after falling 5.0%.

The productivity & cost figures are available in Haver's USECON database. The expectations figures are from the Action Economics Forecast Survey and are found in the AS1REPNA database.