After years of modest productivity growth in the United States during the 2010s, recent data show that labor productivity—measured as output per hour—has increased since 2022. This trend has prompted questions about whether the U.S. economy is entering a new period of higher and more durable productivity growth.
According to research by Nida Çakır Melek and Sydney Miller from the Federal Reserve Bank of Kansas City, labor productivity has moved above its pre-pandemic trend since late 2022. The rise in productivity coincides with the introduction and commercial use of generative artificial intelligence (AI) tools. “Labor productivity has remained above its pre-pandemic trend (dashed blue line) and has risen further above that baseline since late 2022 (dashed purple line). The clear upward climb from 2022:Q3 to 2025:Q2 (purple area) coincides with the commercial emergence of widely used generative AI tools. Notably, this period looks less like a continuation of the 2010s and more like the start of a period of stronger productivity growth,” wrote Çakır Melek and Miller.
The researchers examined whether this increase is broad-based across industries or concentrated in specific sectors, particularly those adopting AI technology. Using data from the Chicago Fed’s Quarterly Industry-Level Labor Productivity dataset and the U.S. Census Bureau’s Business Trends and Outlook Survey on AI adoption rates, they analyzed industry contributions to overall productivity gains.
Their findings indicate that while aggregate labor productivity has increased, most gains are concentrated in a few industries rather than being widespread. “A few industries account for most gains in both eras, while several contribute little or even switch from positive to negative contributions across eras (such as wholesale trade). However, two patterns stand out. First, the top four contributors in the gen-AI era—retail trade, information, professional/scientific/technical services (PSTS), and real estate/rental/leasing—also led contributions in the pre-pandemic era, but their contributions nearly doubled on average. Second, several industries, such as mining and nondurable goods, shifted from small or negative contributions in the pre-pandemic era to meaningful positive contributions in the gen-AI era.”
Within sectors such as information services and professional/scientific/technical services (PSTS), increases were not uniform but driven by sub-sectors like data processing/hosting and computer systems design.
The analysis also showed that higher AI adoption rates tend to align with faster industry-level productivity growth. However, this relationship explains only a small part of total aggregate gains. “Higher-adoption industries tend to have faster productivity growth, consistent with AI contributing to the post-2022 productivity pickup… High-adoption industries are not always the ones with the largest increases in contributions to aggregate productivity growth. For example, manufacturing’s contribution has risen more than information’s despite lower reported AI use.”
Overall, while there is an upward trend in labor productivity following broader AI adoption since 2022, these gains remain concentrated among a smaller set of industries rather than being broadly distributed across all sectors. Whether these improvements will continue or spread more widely remains uncertain.
“Labor productivity has moved notably above its pre-pandemic trend, but the pickup is not yet broad-based: A smaller share of industries accounts for most of the net gain… We find that although AI adoption aligns with faster productivity growth across industries, it explains little of the aggregate gain in productivity,” stated Çakır Melek and Miller.
The authors note that future trends will depend on whether these early gains broaden across more sectors or remain limited to current leading adopters.
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