U.S. nonfarm business sector labor productivity increased at a 2.2 percent annual rate during the second quarter of 2012, higher than the 1.6 percent gain initially estimated, according to revised U.S. Labor Department data released Wednesday.

The increase in productivity reflects increases of 2.4 percent in output, higher than the initial estimate, and 0.1 percent in hours worked, lower than the prior estimate, in the April-June quarter of this year.

The upward revision followed a 0.5 percent decline in the first three months.

Unit labor cost in nonfarm businesses rose 1.5 percent in the second quarter, while hourly compensation increased 3.7 percent.

From April to June, U.S. manufacturing sector productivity rose 0.1 percent as output grew 1.5 percent and hours worked increased 1.4 percent. Over the last four quarters, manufacturing productivity increased 2.9 percent.

Productivity measures the amount of output per hour of work. Increasing productivity can slow job creation because it means companies can get more out of their current staff without hiring more workers.