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Labor Productivity and Costs
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A Closer Look: Manufacturing and Mining Industries


Labor productivity for manufacturing and mining industries

On April 29, 2021, the Bureau of Labor Statistics (BLS) updated measures for 90 detailed industries in Productivity and Costs by Industry: Manufacturing and Mining Industries - 2020. Chart 1 from the news release reveals, at the extremes, that some of these industries had double-digit percentage increases, or decreases, in labor productivity.

Chart 1. Manufacturing and mining industries with the largest change in productivity, 2020 (NAICS 4-digit industries) Chart 1. NAICS 4-digit manufacturing and mining industries with the largest change in productivity, 2020

Chart 1 data. Manufacturing and mining industries with the largest change in productivity, 2020 (NAICS 4-digit industries)
Chart 1 data. Manufacturing and mining industries with the largest percent change in productivity, 2020 (NAICS 4-digit industries)
IndustryNAICS codeEmploymentOutputHours Labor Productivity

Footwear

316211.50.6-12.214.5

Cut and sew apparel

315284.5-6.6-17.112.7

Sawmills and wood preservation

321196.90.8-10.212.2

Seafood product preparation and packaging

311732.41.3-8.510.7

Turbine and power transmission equipment

333690.8-9.7-18.210.4

Computer and peripheral equipment

3341162.2-0.8-9.79.9

Communications equipment

334287.4-1.78.6-9.5

Animal food

311167.4-0.79.8-9.6

Motor vehicle parts

3363540.4-20.1-11.3-9.9

Rubber products

3262134-16.9-7.6-10.1

Textile and fabric finishing mills

313328.7-13.4-2.7-11.0

Office furniture and fixtures

3372102.9-23.2-9.9-14.7

Source: U.S. Bureau of Labor Statistics

 

The productivity program also publishes Multifactor Productivity Trends in Manufacturing, for the manufacturing sector and 19 NAICS 3-digit industries, in the fall of the year after the data reference year; that release uses some different source data and methods than the detailed industry measures. Finally, Multifactor Productivity Trends for Detailed Industries, which includes data for 86 detailed manufacturing industries, comes out in the spring two years after the reference year.

In 2020, the manufacturing sector (NAICS 31-33) comprised 10.6 percent of nonfarm business sector employment (12.48 million workers) and 10.8 percent of U.S. value-added GDP. The mining sector employed approximately 584,700 workers, or 0.5 percent of all total nonfarm employees in 2020, while contributing 0.9 percent to value-added GDP.

On This Page:

  • Annual Data on Labor Productivity and Related Measures

  • Analysis

  • Inquiries and Feedback

  • 2020, month by month

    The BLS productivity program publishes detailed industry productivity data on an annual basis, using source data and estimation methods as described in the Handbook of Methods. In addition, other data sources and methodologies may help explain how underlying economic phenomena contribute to the official measures. This webpage presents two examples of analysis associated with the release of data for the 2020 reference year. In each case, monthly data series reveal more detail about what was, in many ways, an extraordinary and challenging year for U.S. workers, employers, and households.

    A tale of two recessions

    Although more mining and manufacturing industries recorded productivity gains in 2020 than 2019, declines in both output and hours worked were widespread. Output fell in over 90 percent of detailed industries in 2020 and 87 percent had declines in hours worked. Seventy-two industries had concurrent declines in both output and hours worked in 2020. This was the greatest number of such industries since 2009.

    For the manufacturing sector as a whole, productivity decreased 1.6 percent in 2020, reflecting a decrease in output of 8.1 percent and a decrease in hours of 6.6 percent. The decrease in output was the largest annual decline since a decline of 12.0 percent in 2009. The decline in hours was the largest annual decline since a decline of 12.9 percent in 2009.

    On June 8, 2020, the National Bureau of Economic Research determined that February 2020 was the peak in U.S. economic activity and the end of the longest expansion on record that began in 2009.[1] The U.S. officially entered a recession. We take a closer look at the manufacturing sector during the two most recent recessions by examining higher frequency monthly estimates[2] during the 2008-2009 and 2019-2020 periods.

    As shown in chart 2, the record annual decreases during the 2008-2009 period were due to nearly 18 consecutive months of declining output and hours starting in January 2008.

    Chart 2. Indexes of output, hours, and labor productivity, manufacturing sector, 2008-2009

    Chart 2 data. Indexes of output, hours worked, and labor productivity, manufacturing sector, 2008-2009
    Chart 2 data. Indexes of output, hours worked, and labor productivity, manufacturing sector, Jan. 2008-Dec. 2009
    DateOutputHours workedLabor productivity

    Jan-08

    100100100

    Feb-08

    99.34799.83499.512

    Mar-08

    99.074100.0399.044

    Apr-08

    97.97599.00798.958

    May-08

    97.49698.7998.691

    Jun-08

    96.83998.54698.267

    Jul-08

    95.67797.45598.176

    Aug-08

    94.48597.0497.367

    Sep-08

    91.09695.71995.17

    Oct-08

    90.59994.91595.453

    Nov-08

    88.42293.41394.657

    Dec-08

    85.29991.3393.396

    Jan-09

    82.67788.99392.903

    Feb-09

    82.63887.93893.974

    Mar-09

    81.17485.73994.675

    Apr-09

    80.64784.72495.188

    May-09

    79.79383.32395.763

    Jun-09

    79.52882.77396.079

    Jul-09

    80.80882.8197.582

    Aug-09

    81.78282.9198.639

    Sep-09

    82.51382.77299.687

    Oct-09

    82.64382.537100.128

    Nov-09

    83.49683.043100.545

    Dec-09

    83.34482.908100.526

    Source: U.S. Bureau of Labor Statistics

     

    In comparison, as shown in chart 3, the 2019-2020 declines were due to historic monthly decreases in March and April of 2020.

    Chart 3. Indexes of output, hours, and labor productivity, manufacturing sector, 2019-2020

    Chart 3 data. Indexes of output, hours worked, and labor productivity, manufacturing sector, 2019-2020
    Chart 3 data. Indexes of output, hours worked, and labor productivity, manufacturing sector, Jan. 2019-Dec. 2020
    DateOutputHours workedLabor productivity

    Jan-19

    100100100

    Feb-19

    99.47799.7699.716

    Mar-19

    99.4699.70699.753

    Apr-19

    98.59299.49599.092

    May-19

    98.71299.48699.222

    Jun-19

    99.26999.48199.787

    Jul-19

    98.88599.08699.797

    Aug-19

    99.50599.261100.246

    Sep-19

    98.85599.16599.688

    Oct-19

    98.29798.46199.833

    Nov-19

    99.27999.18100.1

    Dec-19

    99.51499.02100.499

    Jan-20

    99.34298.921100.426

    Feb-20

    99.27499.5499.733

    Mar-20

    94.31598.11896.124

    Apr-20

    79.38882.90895.754

    May-20

    82.42486.4395.364

    Jun-20

    88.88589.65199.145

    Jul-20

    92.66691.587101.179

    Aug-20

    94.17892.495101.82

    Sep-20

    94.16193.47100.74

    Oct-20

    95.47294.028101.536

    Nov-20

    96.47593.902102.74

    Dec-20

    97.28393.684103.841

    Source: U.S. Bureau of Labor Statistics

     

    Both recessions illustrate that productivity can be an indicator of cyclical changes in the economy. As illustrated in both charts, at the start of a recession, output growth usually falls before hours, leading to a decrease in productivity. At the end of a recession, output usually rises before hours, leading to an increase in productivity growth.


    A drop in demand for petroleum products

    The consumption of travel-related petroleum products dropped in April 2020. The U.S. Energy Information Administration (EIA) reported that the total consumption of petroleum products fell by 23.3 percent, driven by a 25 percent decrease in the consumption of gasoline and a 50 percent decrease in consumption of jet fuel. Stay-at-home orders and a reduction in travel contributed to the decline in petroleum product consumption as transportation makes up about two-thirds of end-use sectors.[3] Chart 4 demonstrates the important role of gasoline, particularly, in explaining the decreased consumption of refined petroleum products.

    Chart 4. U.S. product supplied for total petroleum products, gasoline, and jet fuel, 2020

    Chart 4 data. U.S. product supplied for total petroleum products, gasoline, and jet fuel, 2020 (thousands of barrels)
    Chart 4 data. U.S. product supplied for total petroleum products, gasoline, and jet fuel, 2020 (thousands of barrels)
    DateU.S. Product Supplied of Crude Oil and Petroleum Products (Thousand Barrels)U.S. Product Supplied of Finished Motor Gasoline (Thousand Barrels)U.S. Product Supplied of Aviation Gasoline (Thousand Barrels)U.S. Product Supplied of Kerosene-Type Jet Fuel (Thousand Barrels)Total PetroleumGasolineJet Fuel

    Jan-2020

    6170662715864265186561706627158652291

    Feb-2020

    5753272600372264725457532726003747480

    Mar-2020

    5667972411982494299956679724119843248

    Apr-2020

    4407301756051872073944073017560520926

    May-2020

    4992002228434191846349920022284318882

    Jun-2020

    5230562485703402356852305624857023908

    Jul-2020

    5680002622013902988956800026220130279

    Aug-2020

    5716202637633463148157162026376331827

    Sep-2020

    5492192563643662763854921925636428004

    Oct-2020

    5773392559123643121757733925591231581

    Nov-2020

    5610732393283343390556107323932834239

    Dec-2020

    5826672429272983545158266724292735749

    Source: U.S. Energy Information Agency

     

    In 2019, the last year in which detailed product-level data are available, oil production made up about three-quarters of the value of production in the oil and gas extraction industry (NAICS 2111) while petroleum products contributed over 90 percent of the value of production in the petroleum and coal mining products manufacturing industry (NAICS 3241). Output trends in both industries are linked to their production of crude oil and petroleum products respectively (see chart 5).

    Chart 5. Industry output indexes for the oil and gas extraction industry and petroleum and coal products industry, 1987-2020

    Chart 5 data. Output index of selected petroleum-related industries, 1987-2020
    Chart 5 data. Output index of selected petroleum-related industries, 1987-2020
    DateOil and gas extractionPetroleum and coal products manufacturing

    1987

    100100

    1988

    99.815102.249

    1989

    96.324102.746

    1990

    95.33103.538

    1991

    95.692102.964

    1992

    94.375105.135

    1993

    92.627108.87

    1994

    93.262109.613

    1995

    92.066111.801

    1996

    92.185114.978

    1997

    92.102119.146

    1998

    91.119121.208

    1999

    88.446119.954

    2000

    89.144121.27

    2001

    89.911120.056

    2002

    87.757121.231

    2003

    87.397122.734

    2004

    85.012126.149

    2005

    81.757126.404

    2006

    82.228126.654

    2007

    83.839127.353

    2008

    85.202128.176

    2009

    89.336126.078

    2010

    91.829131.277

    2011

    96.221133.61

    2012

    108.202132.379

    2013

    120.23136.226

    2014

    137.639139.539

    2015

    146.669140.055

    2016

    140.098142.026

    2017

    146.578143.529

    2018

    169.575146.251

    2019

    188.916145.287

    2020

    178.369122.761

    Source: U.S. Bureau of Labor Statistics

     

    In 2020, the output indexes of both the oil and gas extraction industry and the petroleum and coal products manufacturing industry fell. These indexes do not always move together. Although the industries are related by a production chain, crude oil producers and petroleum refineries react differently to global market conditions. However, the EIA's analysis suggests that the decline in both industries' output in 2020 was caused by falling global demand for petroleum products.[4]

    The EIA reported that refiners responded to the declines in transportation fuel use by decreasing refinery runs, or the consumption of gross inputs. From March to April, refinery runs fell from 15.8 to 13.3 millions of barrels per day, the lowest level since September 2008.[5] Following this decline in refinery runs, output in the petroleum and coal products manufacturing industry declined 15.5 percent in 2020; this was the industry's largest annual rate decline as far back as BLS has data.

    As refineries produced less of petroleum products and global crude oil inventories peaked to all-time highs, well operators began to produce less crude oil.[6] Crude oil production dropped from 12.7 million barrels per day in March to 10 million barrels per day in May. Output in the oil and gas extraction industry declined 5.6 percent in 2020 – also the largest one-year decrease in industry output over the 1987-2020 BLS reference period.

     

    Related resources

    Industries at a Glance: Manufacturing NAICS 31-33

    Industries at a Glance: Mining, Quarrying, and Oil and Gas Extraction NAICS 21

    Multifactor productivity slowdown in U.S. manufacturing

    Dispersion Statistics in Productivity for U.S. manufacturing

    Overview of BLS Productivity Statistics

     

    Notes

    [2] Monthly estimates of manufacturing sector output are based on data on industrial production from the Federal Reserve Board. Measures of hours worked are constructed using data on all employee hours from the BLS Current Employment Statistics (CES) Survey, adjusted with ratios of hours worked to hours paid based on data from the BLS National Compensation Survey (NCS).

    [5] Source: This Week in Petroleum March 3, 2020.

    [6] Source: This Week in Petroleum January 6, 2021.

     

    Last Modified Date: June 15, 2021