Economic News Release

Internet: http://www.bls.gov/lpc/home.htm
Historical, technical					USDL 08-0382
  information:	(202) 691-5618			FOR RELEASE: 10:00 a.m. EDT
Media contact:	(202) 691-5902			THURSDAY, MARCH 20, 2008



                   PRODUCTIVITY AND COSTS BY INDUSTRY:
                     MANUFACTURING INDUSTRIES, 2006


	Labor productivity – defined as output per hour – rose in 52 percent of the 
manufacturing industries studied in 2006, the Bureau of Labor Statistics of the U.S. 
Department of Labor reported today.  This proportion was much smaller than the 88 
percent that recorded productivity increases in the previous year.  Output, the production 
of manufactured goods, rose in 56 percent of the industries in 2006 and hours fell in 57 
percent.  Unit labor costs declined in 33 percent of the industries.

	From 1987 to 2006, labor productivity increased in all but 1 of the 86 
manufacturing industries.  Output rose in 78 percent of the industries and hours fell in 79 
percent.  Unit labor costs fell in 24 percent of the industries during the period.

	This report presents data for the manufacturing industries included in the attached 
tables.  Productivity data for industries in other sectors have been published in separate 
releases and can be found on the BLS Labor Productivity and Costs web site at 
http://www.bls.gov/lpc/home.htm.  Beginning with this release, productivity and related 
indexes and rates of change are available on the web site for all industries for which BLS 
maintains productivity measures.  Previously, data for NAICS 5- and 6-digit 
manufacturing and trade industries were available only upon request.

2005-2006 change

      Labor productivity increased in 2006 in 13 of the 21 3-digit manufacturing 
industries. Table 1 shows the range of productivity changes in these industries.  Strong 
output growth and a slight drop in hours resulted in the largest productivity gain, 8.7 
percent, in computer and electronic products manufacturing (NAICS 334).  In contrast, a 
drop in output combined with an increase in labor hours resulted in the largest 
productivity decline, 6.4 percent, in beverages and tobacco products manufacturing 
(NAICS 312).

      Labor productivity rose in 45 of the 86 4-digit manufacturing industries in 2006.  
(See table 1.)  Productivity increased 3.0 percent or more in approximately one third of 
those industries.  Output grew in 48 industries and hours fell in 49 industries.  The 
computer and peripheral equipment manufacturing industry (NAICS 3341) posted the 
largest productivity gain, 31.7 percent, spurred by strong output growth combined with 
falling hours.  The largest decline in labor productivity, 9.7 percent, occurred in textile 
and fabric finishing and fabric coating mills (NAICS 3133). Labor productivity declined 
in many more industries in 2006 than over the period from 1987 to 2006.

      Unit labor costs, which reflect the total labor costs required to produce a unit of 
output, fell in 28 of the 86 manufacturing industries in 2006.  (See table 1.)  Unit labor 
costs fell most rapidly in computer and peripheral equipment manufacturing (NAICS 
3341) and communications equipment manufacturing (NAICS 3342), the two industries 
with the largest increases in labor productivity.

Long-term trends

      Between 1987 and 2006, labor productivity increased in 85 of the 86 
manufacturing industries.  Output rose in 67 industries and hours fell in 68 industries.  
Productivity grew fastest in computer and peripheral equipment manufacturing (NAICS 
3341) and semiconductor and other electronic component manufacturing (NAICS 3344), 
an average 24.1 percent per year and 16.8 percent per year, respectively.  Both industries 
experienced strong growth in output combined with falling hours over the long term 
period.  Productivity fell from 1987 to 2006 in just one industry, accessories and other 
apparel manufacturing (NAICS 3159). 

	Unit labor costs fell in 21 of the 86 manufacturing industries from 1987 to 2006.  
The two industries with the fastest productivity growth, computer and peripheral 
equipment manufacturing (NAICS 3341) and semiconductor and other electronic 
component manufacturing (NAICS 3344), also recorded the largest declines in unit labor 
costs.