Labor productivity growth in the US accelerated to the fastest level in a year in the third quarter, and companies are working hard to improve efficiency to ease the pressure caused by rising costs. Labor productivity, which measures the hourly output of non-farm enterprises, increased at an annual rate of 3.6% in the third quarter, up from 2.1% after an upward revision in the previous quarter, according to data released by the US Bureau of Labor Statistics on Thursday. Unit labor costs fell 0.7%, the first decline since the second quarter of 2025. Labor costs are the biggest expense item for many businesses, so companies invest in new technology and equipment to improve employee productivity. Increased productivity helps companies reduce price increases to consumers and other businesses.

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