Transmission of material in this release is embargoed until USDL-10-0140
8:30 a.m. (EST) Thursday, February 4, 2010
Technical information: (202) 691-5606 • dprweb@bls.gov • www.bls.gov/lpc
Media contact: (202) 691-5902 • PressOffice@bls.gov
PRODUCTIVITY AND COSTS
Fourth Quarter and Annual Averages 2009, Preliminary
Nonfarm business sector labor productivity increased at a 6.2 percent annual
rate during the fourth quarter of 2009, the U.S. Bureau of Labor Statistics
reported today. This gain in productivity reflects increases of 7.2 percent
in output and 1.0 percent in hours worked. (All quarterly percent changes in
this release are seasonally adjusted annual rates.) This was the first
quarterly increase in hours worked since the second quarter of 2007
(0.9 percent). Productivity increased 5.1 percent over the last four quarters
--more than during any similar period since output per hour rose 6.1 percent
from the first quarter of 2001 to the first quarter of 2002 (table A).
Labor productivity is calculated by dividing an index of real output by an
index of the combined hours worked of all persons, including employees,
proprietors, and unpaid family workers.
Unit labor costs in nonfarm businesses fell 4.4 percent in the fourth quarter
of 2009, a result of the increase in productivity (6.2 percent) outpacing the
increase in hourly compensation (1.5 percent). BLS defines unit labor costs
as the ratio of hourly compensation to labor productivity; increases in hourly
compensation tend to increase unit labor costs and increases in output per
hour tend to reduce them. Over the last four quarters, unit labor costs
declined 2.8 percent, as hourly compensation and productivity increased 2.2
percent and 5.1 percent, respectively (table A). This decline in unit labor
costs was the largest since unit labor costs fell 3.2 percent over the four
quarters ending with the first quarter of 2002.
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Data in this release do not reflect the annual benchmark revision of the BLS
Current Employment Statistics program data to be released February 5, 2010.
This benchmark will be incorporated in our next release on March 4, 2010.
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Manufacturing sector productivity grew 7.8 percent in the fourth quarter of
2009, as output rose 6.1 percent and hours worked declined 1.6 percent.
Productivity grew 6.2 percent in durable goods industries and 9.8 percent in
nondurable goods industries in the fourth quarter. Over the last four
quarters, manufacturing productivity increased 6.5 percent as output decreased
4.4 percent and hours fell 10.2 percent (table A). Unit labor costs in
manufacturing declined 7.4 percent in the fourth quarter of 2009 and decreased
3.2 percent from the same quarter a year earlier (table A).
The data sources and methods used in the preparation of the manufacturing
output series differ from those used in preparing the business and nonfarm
business output series, and these measures are not directly comparable. See
Technical Notes for further information on data sources.
Revised measures
Revised and previous measures for the third quarter of 2009 in tables B and D
cover the major sectors: nonfarm business, business, manufacturing and
nonfinancial corporations.
In the third quarter of 2009, nonfarm business productivity growth was revised
down from 8.1 percent to 7.2 percent compared to the estimate published on
December 3, reflecting a downward revision to output and a slight upward
revision to hours. Unit labor costs for nonfarm business fell 1.5 percent, a
smaller decline than previously reported. In both the manufacturing and
nonfinancial corporate sectors productivity was revised upward due to upward
revisions in output.
Table C presents Annual Averages for the most recent five years. In the
nonfarm business sector, productivity increased 2.9 percent in 2009, and
reflected the largest annual declines in output and hours (-3.6 percent and
-6.4 percent, respectively) for these measures, which begin in 1948.
Manufacturing sector productivity grew 1.3 percent in 2009, due to a decline
in both output (-11.0 percent) and hours (-12.1 percent)--the largest annual
declines recorded in these series, which begin in 1988. Over the long run,
from 2000 to 2009, nonfarm business productivity increased at an average
annual rate of 2.6 percent, and manufacturing productivity increased at a
rate of 3.1 percent.
Quarterly and annual data for all sectors for 2007 to 2009 appear in tables
1-6. Full historical measures can be found on the productivity and costs
home page http://www.bls.gov/lpc/#data.
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The revised Productivity and Costs press release for fourth-quarter 2009
is scheduled to be released on Thursday, March 4, 2010 at 8:30 a.m. (EST).
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Table A. Preliminary fourth-quarter 2009 measures, percent change from previous quarter, annual rate
(Q to Q) and from same quarter a year ago (Y to Y)
Sector Nonfarm Durable Nondurable
Business Business Manufacturing Manufacturing Manufacturing
Q to Q Y to Y Q to Q Y to Y Q to Q Y to Y Q to Q Y to Y Q to Q Y to Y
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Productivity 6.2 5.1 6.5 5.2 7.8 6.5 6.2 4.6 9.8 6.0
Output 7.2 -0.3 7.2 -0.2 6.1 -4.4 5.0 -8.8 7.2 0.0
Hours 1.0 -5.1 0.6 -5.2 -1.6 -10.2 -1.1 -12.8 -2.4 -5.7
Hourly
compensation 1.5 2.2 1.6 2.2 -0.2 3.0 -0.6 4.6 0.5 0.9
Real hourly
compensation -1.9 0.7 -1.8 0.8 -3.5 1.5 -3.9 3.0 -2.8 -0.6
Unit labor costs -4.4 -2.8 -4.7 -2.8 -7.4 -3.2 -6.4 -0.1 -8.5 -4.8
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Table B. Revised and previous measures, third quarter 2009
Sector Nonfarm Durable Nondurable
Business Business Manufacturing Manufacturing Manufacturing
Revised Previous Revised Previous Revised Previous Revised Previous Revised Previous
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Productivity 7.2 8.1 7.4 8.5 14.4 13.4 21.9 20.3 6.5 6.1
Output 2.2 2.9 2.2 3.1 9.5 8.4 14.9 13.1 4.7 4.2
Hours -4.7 -4.8 -4.8 -5.0 -4.2 -4.4 -5.8 -6.0 -1.7 -1.8
Hourly
compensation 5.5 5.4 5.9 5.8 6.4 6.5 7.1 7.3 5.5 5.5
Real hourly
compensation 1.9 1.8 2.2 2.1 2.7 2.8 3.4 3.5 1.8 1.8
Unit labor
costs -1.5 -2.5 -1.4 -2.4 -7.0 -6.1 -12.2 -10.9 -1.0 -0.5
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Table C. Annual average changes in productivity and related measures, 2005-2009
Sector Nonfarm Business Manufacturing
2005 2006 2007 2008 2009 | 2005 2006 2007 2008 2009
--------------------------------------------------------------|----------------------------------------
Productivity 1.7 0.9 1.8 1.8 2.9 | 4.8 1.0 3.2 0.8 1.3
Output 3.4 3.1 2.3 -0.1 -3.6 | 3.7 1.8 1.3 -3.1 -11.0
Hours 1.7 2.2 0.5 -1.9 -6.4 | -1.1 0.8 -1.8 -3.9 -12.1
Hourly compensation 4.0 3.8 4.2 2.8 2.0 | 3.3 2.0 4.3 3.0 4.8
Real hourly |
compensation 0.6 0.5 1.3 -1.0 2.4 | 0.0 -1.3 1.4 -0.8 5.2
Unit labor costs 2.3 2.8 2.3 1.0 -0.9 | -1.4 0.9 1.1 2.1 3.5
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Table D. Nonfinancial corporations: revised third-quarter 2009 productivity and cost measures
Real
Hourly hourly Unit Implicit
Produc- compen- compen- labor Unit price
tivity Output Hours sation sation costs profits deflator
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Percent change, annual rate
Revised 6.3 1.4 -4.6 5.3 1.6 -1.0 16.2 -1.8
Previous 5.3 0.2 -4.8 5.2 1.5 -0.1 7.8 -1.6
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