U.S. Worker Productivity Jumps to 6.4% Rate

U.S. workers’ productivity surged in the second quarter to an annual rate of 6.4%, the fastest in almost six years, the Labor Department said Tuesday.

The rate followed a 0.3% rate in the first quarter, less than originally reported, Labor said.

Productivity is a measure of how much an employee produces for every hour of work.

The level topped economists’ forecasts of a 5.5% annual rate, Bloomberg reported.

Among manufacturers, productivity rose at a 5.3% rate, compared with a 2.3% decline in the first quarter.

Labor costs fell at a 5.8% rate, the second straight drop and the biggest in eight years.

Productivity rose 1.8% compared with last year’s second quarter, the biggest year-over-year increase in a year, Bloomberg reported.

When worker efficiency improves at a slower pace and labor becomes more expensive, companies may raise prices in order to guard their profits, contributing to more rapid inflation.