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Productivity and Costs by Industry: Manufacturing and Mining Industries News Release
For release 10:00 a.m. (EDT) Thursday, April 19, 2018 USDL-18-0591
Technical information: (202) 691-5606 • productivity@bls.gov • www.bls.gov/lpc
Media contact: (202) 691-5902 • PressOffice@bls.gov
PRODUCTIVITY AND COSTS BY INDUSTRY:
MANUFACTURING AND MINING INDUSTRIES, 2017
Labor productivity declines were widespread among manufacturing industries in 2017, with decreases in 54 of
the 86 four-digit NAICS industries. Of the 51 industries in durable manufacturing, 34 experienced productivity
decreases in 2017 led by a decline in the other transportation equipment industry of 11.5 percent. Nondurable
manufacturing also experienced widespread declines in 2017 with productivity falling in 20 of 35 industries, led
by the sugar and confectionery products industry with a decrease of 8.0 percent. Of the 4 industries in the mining
sector, 3 had productivity gains in 2017 led by the oil and gas extraction industry with an increase of 32.6
percent.
Labor Productivity Trends in 3-Digit Industries, 2017
Manufacturing
* Labor productivity decreased in 15 of the 21 NAICS 3-digit manufacturing industries in 2017,
as output declined in 15 industries and hours worked rose in 13.
* The beverage and tobacco products industry had the fastest productivity decline of 9.2
percent, as output fell 2.9 percent and hours worked increased 6.9 percent.
* The primary metals industry had the largest productivity gain of 3.6 percent, as output
increased and hours decreased.
Mining
* Labor productivity rose by 32.6 percent in the oil and gas extraction industry where a
significant decline in hours worked outpaced modest growth in output.
* The mining, except oil and gas industry had productivity gains of 2.9 percent, as output
increased and hours worked decreased.
Trends in Unit Labor Costs in 2017
Unit labor costs, which reflect the total labor costs required to produce a unit of output, rose in 73 of the
86 NAICS 4-digit manufacturing industries. Of the 51 industries in durable manufacturing, 45
experienced rising unit labor costs led by the audio and video equipment manufacturing industry with an
increase of 16.8 percent. Nondurable manufacturing also experienced widespread increases in unit labor
costs with 28 of the 35 industries recording an increase, led by the apparel accessories and other apparel
manufacturing industry with a rise of 13.0 percent. Of the 4 industries in the mining sector, 3 had
decreases in unit labor costs led by the oil and gas extraction industry with a decline of 18.6 percent.
Unit Labor Cost Trends in 3-Digit Industries, 2017
Manufacturing
* Employers experience increased unit labor costs when hourly compensation growth outpaces
productivity growth. Unit labor costs increased in 19 of the 21 manufacturing industries, as
hourly compensation growth outpaced that of productivity.
Mining
* Unit labor costs declined in the oil and gas extraction industry by 18.6 percent, as
productivity and hourly compensation increased by 32.6 percent and 7.9 percent respectively.
* The mining, except oil and gas industry had an increase in unit labor costs, as hourly
compensation rose faster than productivity.
Long-Term Trends in Labor Productivity and Unit Labor Costs
Labor Productivity
* Over the entire 1987-2017 period, labor productivity rose in 83 of the 90 manufacturing
and mining industries. This was associated with output rising in 58 industries, while hours
worked increased in only 15.
* During the more recent 2007-2017 period, which included the Great Recession,
productivity increased in only 43 industries. These increases are predominantly the result
of a decline in hours worked rather than an increase in output, as hours worked fell in 72
industries while output increased in only 15.
Unit Labor Costs
* During the 1987-2017 period, unit labor costs increased in 80 of the 90 manufacturing and
mining industries. Among the NAICS 4-digit industries, unit labor costs increased in 76 of the 86
manufacturing industries. All of the 4 mining industries saw an increase in unit labor costs.
* From 2007 to 2017, unit labor costs increased in 80 of the 86 manufacturing industries and in 3
of the 4 mining industries. The computer and peripheral equipment manufacturing industry was
the only industry with declines in both labor productivity and unit labor costs, as hourly
compensation fell faster than productivity.
The computer and peripheral equipment manufacturing industry recorded the largest productivity gain as
well as the largest unit labor cost decline during both the 1987-2017 and 1987-2007 periods. However,
between 2007 and 2017, this industry saw the sharpest drop in unit labor costs while the oil and gas
extraction industry posted the greatest productivity growth.
Additional Information
Manufacturing industry output for 2017 is constructed with data on industrial production from the
Federal Reserve and BLS price indexes. These measures also incorporate data from the Census Bureau’s
2016 Annual Survey of Manufactures.
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* - Detailed data series: indexes of productivity and related measures; rates of change; and *
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Technical Note
Labor Productivity: Labor productivity describes the relationship between real output and the labor
hours involved in its production. These measures show the changes from period to period in the amount
of goods and services produced per hour worked. Although the labor productivity measures relate output
in an industry to hours worked of all persons in that industry, they do not measure the specific
contribution of labor to growth in output. Rather, they reflect the joint effects of many influences,
including: changes in technology; capital investment; utilization of capacity, energy, and materials; the
use of purchased services inputs, including contract employment services; the organization of
production; the characteristics and effort of the workforce; and managerial skill.
Unit Labor Costs: Unit labor costs represent the cost of labor required to produce one unit of output.
The unit labor cost indexes are computed by dividing an index of nominal industry labor compensation
by an index of real industry output. Unit labor costs also describe the relationship between compensation
per hour worked (hourly compensation) and real output per hour worked (labor productivity). When
hourly compensation growth outpaces productivity, unit labor costs increase. Alternatively, when
productivity growth exceeds hourly compensation, unit labor costs decrease.
Output: Industry output is measured as an annual-weighted index of the changes in the various products
(in real terms) provided for sale outside the industry. Real industry output is usually derived by deflating
nominal sales or values of production using BLS price indexes, but for some industries it is measured by
physical quantities of output. Industry output reflects sectoral value of production, derived by adjusting
shipments for changes in inventories and removing intra-industry transactions. Industry output measures
are constructed primarily using data from the economic censuses and annual surveys of the Census
Bureau, U.S. Department of Commerce, together with data on price changes primarily from BLS. Data
from the Bureau of Economic Analysis at the U.S. Department of Commerce is used in part to construct
intra-industry transactions. Other data sources include the Energy Information Administration at the
U.S. Department of Energy and the U.S. Geological Survey at the U.S. Department of the Interior.
Manufacturing industry output for 2017 is constructed with data on industrial production from the
Federal Reserve and BLS price indexes.
Labor Hours: Labor hours are measured as annual hours worked by all employed persons in an
industry. Data on industry employment and hours come primarily from the BLS Current Employment
Statistics (CES) survey and Current Population Survey (CPS). CES data on the number of total and
production worker jobs held by wage and salary workers in nonfarm establishments are supplemented
with CPS data on self-employed and unpaid family workers to estimate industry employment. Hours
worked estimates are derived using CES and CPS employment, CES data on the average weekly hours
paid of production workers, CPS data on hours of nonproduction, self-employed, and unpaid family
workers, and ratios of hours worked to hours paid based on data from the National Compensation
Survey (NCS). For some industries, employment and hours data are supplemented or further
disaggregated using data from the BLS Quarterly Census of Employment and Wages (QCEW), the
Census Bureau, or other sources. Hours worked are estimated separately for different types of workers
and then are directly aggregated; no adjustments for labor composition are made.
Labor Compensation: Labor compensation, defined as payroll plus supplemental payments, is a
measure of the cost to the employer of securing the services of labor. Payroll includes salaries, wages,
commissions, dismissal pay, bonuses, vacation and sick leave pay, and compensation in kind.
Supplemental payments include both legally required expenditures and payments for voluntary
programs. The legally required portion consists primarily of federal old age and survivors’ insurance,
unemployment compensation, and workers’ compensation. Payments for voluntary programs include all
programs not specifically required by legislation, such as the employer portion of private health
insurance and pension plans. Industry compensation measures are constructed primarily using data from
the BLS QCEW and the economic censuses of the Census Bureau at the U.S. Department of Commerce.
Table 1. Recent labor productivity, unit labor costs, and related data
Industry
2012 NAICS code
2017 Employment (thousands)
Percent change, 2016-2017
Labor productivity
Unit labor costs
Output
Hours worked
Labor compensation
Mining
Mining
21
640.9
2.4
-4.7
3.3
0.8
-1.6
Oil and gas extraction
211
146.7
32.6
-18.6
3.6
-21.9
-15.7
Oil and gas extraction
2111
146.7
32.6
-18.6
3.6
-21.9
-15.7
Mining, except oil and gas
212
185.6
2.9
0.5
2.5
-0.4
3.0
Coal mining
2121
51.9
0.0
-0.2
6.8
6.8
6.7
Metal ore mining
2122
38.7
6.2
1.3
-1.0
-6.8
0.3
Nonmetallic mineral mining and quarrying
2123
95.0
3.6
-0.2
2.0
-1.5
1.9
Nondurable Manufacturing
Food
311
1,650.3
-2.8
5.9
0.4
3.4
6.4
Animal food
3111
60.2
4.8
5.2
2.8
-1.9
8.1
Grain and oilseed milling
3112
61.6
1.3
1.0
3.6
2.3
4.6
Sugar and confectionery products
3113
79.6
-8.0
7.5
-4.7
3.6
2.4
Fruit and vegetable preserving and specialty
3114
175.8
-4.5
-1.1
5.7
10.6
4.5
Dairy products
3115
145.1
-2.7
7.4
-1.1
1.6
6.2
Animal slaughtering and processing
3116
517.0
-4.2
8.8
0.1
4.5
8.9
Seafood product preparation and packaging
3117
40.0
4.2
2.2
-0.6
-4.6
1.6
Bakeries and tortilla products
3118
347.2
-2.3
6.9
-1.6
0.8
5.2
Other food products
3119
223.8
-4.3
8.3
-1.3
3.1
6.9
Beverages and tobacco products
312
272.8
-9.2
8.6
-2.9
6.9
5.5
Beverages
3121
259.9
-7.8
6.4
-0.6
7.8
5.7
Tobacco
3122
12.9
0.4
12.8
-9.0
-9.3
2.6
Textile mills
313
115.9
3.2
4.4
-1.9
-5.0
2.4
Fiber, yarn, and thread mills
3131
30.9
3.1
-0.5
4.5
1.4
4.0
Fabric mills
3132
54.0
4.0
6.8
-3.8
-7.5
2.8
Textile and fabric finishing mills
3133
31.0
2.8
4.6
-3.7
-6.4
0.6
Textile product mills
314
129.5
-3.9
4.9
-2.1
1.9
2.6
Textile furnishings mills
3141
55.6
-1.4
5.5
-3.4
-2.0
1.9
Other textile product mills
3149
73.9
-5.2
3.6
-0.3
5.1
3.3
Apparel
315
136.9
-2.5
7.4
-9.8
-7.4
-3.1
Apparel knitting mills
3151
11.2
10.5
-1.7
-1.1
-10.5
-2.8
Cut and sew apparel
3152
112.1
-4.0
7.8
-10.9
-7.2
-3.9
Accessories and other apparel
3159
13.6
-2.2
13.0
-8.4
-6.3
3.5
Leather and allied products
316
33.8
-1.7
1.6
-3.1
-1.4
-1.5
Leather and hide tanning and finishing
3161
5.5
-6.2
3.0
-5.6
0.7
-2.7
Footwear
3162
13.5
4.9
-1.3
0.8
-4.0
-0.5
Other leather products
3169
14.8
-6.2
3.6
-5.4
0.9
-2.0
Paper
322
371.0
0.6
1.8
-0.8
-1.3
1.1
Pulp, paper, and paperboard mills
3221
99.2
1.2
0.4
-0.3
-1.5
0.1
Converted paper products
3222
271.8
0.3
2.6
-1.0
-1.3
1.6
Printing and related support activities
323
463.5
0.0
-0.1
0.2
0.2
0.0
Printing and related support activities
3231
463.5
0.0
-0.1
0.2
0.2
0.0
Petroleum and coal products
324
114.9
0.7
1.5
0.3
-0.4
1.8
Petroleum and coal products
3241
114.9
0.7
1.5
0.3
-0.4
1.8
Chemicals
325
837.7
-2.5
3.5
-0.9
1.6
2.6
Basic chemicals
3251
150.8
1.1
2.6
0.5
-0.6
3.1
Resin, rubber, and artificial fibers
3252
95.9
-3.3
2.3
-0.4
3.1
2.0
Agricultural chemicals
3253
35.7
7.1
-10.1
14.8
7.2
3.2
Pharmaceuticals and medicines
3254
295.8
-7.0
7.7
-5.2
1.9
2.1
Paints, coatings, and adhesives
3255
61.7
-0.9
-0.4
4.5
5.4
4.1
Soaps, cleaning compounds, and toiletries
3256
113.0
-1.0
4.4
-2.0
-1.0
2.3
Other chemical products and preparations
3259
84.8
-3.0
6.2
-1.3
1.7
4.8
Plastics and rubber products
326
718.6
-3.9
6.7
-1.5
2.5
5.1
Plastics products
3261
581.3
-3.7
6.7
-1.0
2.7
5.6
Rubber products
3262
137.3
-4.9
7.3
-3.6
1.3
3.4
Durable Manufacturing
Wood products
321
425.1
-1.7
5.0
1.0
2.8
6.1
Sawmills and wood preservation
3211
97.3
-1.6
4.4
0.5
2.1
4.9
Plywood and engineered wood products
3212
78.0
1.3
8.3
-0.9
-2.1
7.3
Other wood products
3219
249.8
-2.5
3.8
2.3
4.8
6.2
Nonmetallic mineral products
327
430.5
-3.9
5.1
-0.5
3.6
4.6
Clay products and refractories
3271
47.2
-2.9
5.4
1.4
4.4
6.9
Glass and glass products
3272
90.0
2.2
0.4
0.5
-1.6
0.9
Cement and concrete products
3273
198.5
-6.7
7.7
-1.8
5.3
5.7
Lime and gypsum products
3274
14.8
-3.2
4.5
-0.2
3.1
4.2
Other nonmetallic mineral products
3279
80.0
-3.8
4.2
0.8
4.7
5.0
Primary metals
331
373.9
3.6
1.2
2.0
-1.5
3.3
Iron and steel mills and ferroalloys
3311
83.8
3.2
2.2
5.2
1.9
7.6
Steel products from purchased steel
3312
56.6
3.2
-3.0
5.2
2.0
2.1
Alumina and aluminum production
3313
58.1
0.0
3.1
-1.3
-1.3
1.7
Other nonferrous metal production
3314
59.3
2.8
3.6
-2.4
-5.1
1.1
Foundries
3315
116.1
4.4
1.5
0.3
-3.9
1.8
Fabricated metal products
332
1,457.0
-1.4
3.9
-1.1
0.3
2.8
Forging and stamping
3321
100.7
0.5
2.8
0.3
-0.2
3.1
Cutlery and handtools
3322
40.0
9.4
-0.5
3.4
-5.5
2.9
Architectural and structural metals
3323
378.1
-3.3
8.7
-4.0
-0.7
4.3
Boilers, tanks, and shipping containers
3324
91.7
-0.1
0.7
-1.0
-0.9
-0.2
Hardware
3325
25.0
-0.6
6.1
-2.4
-1.8
3.6
Spring and wire products
3326
43.8
-3.1
9.6
-2.3
0.8
7.1
Machine shops and threaded products
3327
363.0
-0.1
3.7
-0.6
-0.4
3.1
Coating, engraving, and heat treating metals
3328
138.0
-2.2
2.0
0.3
2.6
2.4
Other fabricated metal products
3329
276.7
-2.4
0.5
0.6
3.1
1.1
Machinery
333
1,091.0
2.6
-1.2
4.6
1.9
3.3
Agriculture, construction, and mining machinery
3331
210.4
10.4
-14.3
16.4
5.4
-0.2
Industrial machinery
3332
115.9
1.8
6.7
1.9
0.1
8.7
Commercial and service industry machinery
3333
91.5
-1.0
4.9
0.1
1.1
5.0
HVAC and commercial refrigeration equipment
3334
130.7
0.6
3.8
0.5
-0.1
4.3
Metalworking machinery
3335
182.3
-1.3
3.9
-0.2
1.1
3.7
Turbine and power transmission equipment
3336
96.3
-0.3
-1.0
0.9
1.2
-0.1
Other general purpose machinery
3339
263.9
0.7
0.9
2.8
2.1
3.8
Computer and electronic products
334
1,049.2
-1.1
5.8
-2.0
-0.9
3.8
Computer and peripheral equipment
3341
161.6
11.0
-10.9
14.4
3.1
1.9
Communications equipment
3342
86.7
-2.2
8.6
-5.0
-2.9
3.1
Audio and video equipment
3343
19.6
-0.4
16.8
-9.1
-8.7
6.2
Semiconductors and electronic components
3344
363.6
-0.7
10.4
-5.0
-4.3
4.9
Electronic instruments
3345
403.0
-3.8
5.8
-1.9
1.9
3.8
Magnetic media manufacturing and reproducing
3346
14.7
7.4
12.9
-4.6
-11.2
7.7
Electrical equipment and appliances
335
395.4
-4.8
6.1
-1.3
3.7
4.7
Electric lighting equipment
3351
52.8
-9.2
2.1
0.4
10.6
2.5
Household appliances
3352
63.1
-3.0
6.5
-1.4
1.7
5.0
Electrical equipment
3353
140.9
-6.2
8.6
-5.9
0.3
2.3
Other electrical equipment and components
3359
138.6
-4.0
6.8
1.4
5.6
8.2
Transportation equipment
336
1,649.7
-4.4
7.3
-4.1
0.3
2.9
Motor vehicles
3361
212.4
-4.1
10.3
-6.7
-2.7
2.8
Motor vehicle bodies and trailers
3362
156.0
-1.8
6.6
-0.5
1.4
6.0
Motor vehicle parts
3363
591.7
-1.3
4.3
-1.3
0.1
2.9
Aerospace products and parts
3364
487.0
-3.1
6.6
-3.4
-0.2
3.0
Railroad rolling stock
3365
22.4
3.2
-6.7
-8.2
-11.0
-14.3
Ship and boat building
3366
141.0
-6.1
2.2
-0.2
6.3
2.0
Other transportation equipment
3369
39.2
-11.5
4.9
1.6
14.8
6.5
Furniture and related products
337
421.4
-4.0
6.9
-2.9
1.2
3.9
Household and institutional furniture
3371
271.1
-4.3
6.1
-1.3
3.1
4.7
Office furniture and fixtures
3372
112.2
-1.0
6.6
-3.4
-2.4
3.0
Other furniture related products
3379
38.1
-6.1
10.3
-7.7
-1.7
1.8
Miscellaneous manufacturing
339
646.9
-1.5
8.1
-3.7
-2.2
4.1
Medical equipment and supplies
3391
315.4
1.3
9.2
-4.3
-5.5
4.5
Other miscellaneous manufacturing
3399
331.5
-4.2
6.7
-2.9
1.4
3.6
Table 2. Long run labor productivity, unit labor costs, and related data
United States Department of Labor
