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On a seasonally adjusted annual rate, non-farm business productivity rose 2.2 percent in the quarter after a first-quarter gain of 2.6 percent. Unit labor costs rose 1.3 percent after rising 2.5 percent in the first quarter, the U.S. Bureau of Labor Statistics reported.

Analysts predicted productivity to rise 2.7 percent rate but labor costs grew as predicted.

Productivity declined 3.5 percent in durable goods manufacturing and rose 0.7 percent in nondurable goods production with an overall decline of 1.4 percent. The decline was attributed to decreased output and a decline in hours worked, which fell at an annual adjusted 0.5 percent, the report said.

It was the second consecutive quarter in which hours worked declined in the United States. In the first quarter, hours worked fell by an annual rate of 1.6 percent.

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