AlHijjah 16, 1433, Nov 1, 2012, SPA -- U.S. worker productivity grew at the same modest rate in the summer as in the spring, providing little sign that businesses are set to expand hiring, but indicating that firms may be nearing the limits on how much output they can get from their employees, the government said Thursday. The Labor Department reported that productivity, which measures hourly output per worker, increased at a 1.9 percent annual rate in the July-September quarter, mating the April-June quarter rate. Labor costs fell at a 0.1 percent rate in the third quarter after having risen at a 1.7 percent rate in the second quarter. Productivity gains are good for companies and help improve society's standard of living by increasing wages, but weak productivity can be a hopeful sign for job creation, often showing that firms cannot squeeze much more output from their staff and must hire to meet demand. Over the past year, productivity has risen only 1.5 percent, or half the average growth that companies saw in 2009 and 2010, shortly after many laid off workers to cut costs during the Great Recession. Economists expect worker productivity to slow for the rest of 2012 and through next year. Higher productivity is typical during and after a recession, as companies often cut workers amid falling demand and increase output from a smaller workforce. Once an economy begins to grow, demand rises and firms eventually must add workers.
