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Nonfarm business labor productivity down 1.5 percent in first quarter 2025
June 11, 2025
Nonfarm business sector labor productivity decreased 1.5 percent in the first quarter of 2025, as output decreased 0.2 percent and hours worked increased 1.3 percent. This is the first decline in nonfarm business sector labor productivity since the second quarter of 2022. From the first quarter of 2024, nonfarm business sector labor productivity increased 1.3 percent.
Nonfarm business labor productivity and related measures, percent change from previous quarter
Quarter
Labor productivity
Output
Unit labor costs
Hours worked
Hourly compensation
Q1 2020
-1.8
-7.5
11.8
-5.8
9.7
Q2 2020
20.9
-32.9
3.9
-44.5
25.6
Q3 2020
6.6
46.3
-11.6
37.3
-5.7
Q4 2020
-3.0
5.7
14.1
9.0
10.6
Q1 2021
3.0
7.2
-2.4
4.1
0.5
Q2 2021
0.1
7.6
6.4
7.5
6.5
Q3 2021
-2.3
3.4
8.0
5.8
5.5
Q4 2021
2.9
9.1
2.9
6.1
5.9
Q1 2022
-4.9
-2.0
6.8
3.0
1.6
Q2 2022
-3.3
-0.3
3.8
3.0
0.4
Q3 2022
0.0
2.6
7.4
2.6
7.4
Q4 2022
2.7
3.7
-2.2
1.0
0.4
Q1 2023
0.7
2.5
3.0
1.8
3.7
Q2 2023
3.4
2.4
3.1
-1.0
6.5
Q3 2023
4.7
5.0
1.0
0.3
5.8
Q4 2023
3.5
3.4
1.2
-0.1
4.7
Q1 2024
1.6
1.3
8.3
-0.3
10.1
Q2 2024
2.1
3.0
-0.9
1.0
1.1
Q3 2024
2.9
3.6
-1.5
0.7
1.3
Q4 2024
1.7
2.5
3.8
0.8
5.5
Q1 2025
-1.5
-0.2
6.6
1.3
5.0
Note: Quarterly data are seasonally adjusted annual rates.
Unit labor costs in the nonfarm business sector increased 6.6 percent in the first quarter of 2025, reflecting a 5.0-percent increase in hourly compensation and a 1.5-percent decrease in productivity.
These data are from the Productivity program and are seasonally adjusted annual rates, subject to revision. See "Productivity and Costs — First Quarter, Revised" to learn more. We also have more charts on productivity and costs. Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked for all persons, including employees, proprietors, and unpaid family workers.
United States Department of Labor
