Fourth quarter non-farm labor costs ease

Washington -- Fourth-quarter U.S. productivity rose faster than labor costs, indicating a drop in compensation pressure for non-farm business, the government said Thursday.

On an annually adjusted basis, non-farm business productivity rose 3.2 percent in the quarter, higher than the expected increase of 1.1 percent.

Labor costs rose 1.8 percent, lower than the forecast of 2.9 percent.

The news translates to the potential for higher profits for U.S. markets, but also points to weak production, which rose 2.8 percent for the year among non-farm businesses.

In the quarter, manufacturing productivity declined 3 percent, including a 13.4 percent drop in durable goods and a 7.6 percent rise in non-durable goods. For the year, manufacturing for durable goods rose 1.4 percent. For the year, non-durable goods production was up 1 percent.

Copyright 2009 by United Press International.