Productivity and Costs News Release


Transmission of material in this release is embargoed until                                   USDL 18-1315
8:30 a.m. (EDT) Wednesday, August 15, 2018

Technical information: (202) 691-5606 •  Productivity@bls.gov • www.bls.gov/lpc
Media contact:         (202) 691-5902 •  PressOffice@bls.gov



                                     PRODUCTIVITY AND COSTS
                                Second Quarter 2018, Preliminary

Nonfarm business sector labor productivity increased 2.9 percent during the second quarter of 2018, 
the U.S. Bureau of Labor Statistics reported today, as output increased 4.8 percent and hours worked 
increased 1.9 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) 
From the second quarter of 2017 to the second quarter of 2018, productivity increased 1.3 percent, 
reflecting a 3.5-percent increase in output and a 2.2-percent increase in hours worked. (See tables A1 
and 2.)

Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of 
hours worked by all persons, including employees, proprietors, and unpaid family workers. 

Unit labor costs in the nonfarm business sector decreased 0.9 percent in the second quarter of 2018, 
reflecting a 2.0-percent increase in hourly compensation and a 2.9-percent increase in productivity. Unit 
labor costs increased 1.9 percent over the last four quarters. (See tables A1 and 2.)  

===========================================================================================================
                        Historical Revisions to Productivity and Costs Data

Data in this release reflect the 2018 Comprehensive Update of the National Income and Product 
Accounts (NIPA) released by the Bureau of Economic Analysis of the U.S. Department of Commerce 
on July 27, 2018. See “Revised measures” section.
===========================================================================================================

BLS calculates 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. 

Manufacturing sector labor productivity increased 0.9 percent in the second quarter of 2018, as 
output increased 1.9 percent and hours worked increased 1.0 percent. Productivity increased 0.9 percent 
in the durable manufacturing sector, as output rose 2.4 percent and hours worked increased 1.4 percent. 
In the non-durable goods manufacturing sector, a 1.1-percent increase in productivity reflected a 1.5-
percent increase in output and a 0.4-percent increase in hours worked. Over the last four quarters, total 
manufacturing sector productivity decreased 0.2 percent, as output increased 1.8 percent and hours 
worked increased 2.1 percent. Unit labor costs in manufacturing rose 0.6 percent in the second quarter 
of 2018 and increased 2.7 percent from the same quarter a year ago. (See tables A1 and 3.)

The concepts, sources, and methods used for the manufacturing output series differ from those used in 
the business and nonfarm business output series; these output measures are not directly comparable. See 
the Technical Notes for a more detailed explanation.

Revised first-quarter 2018 measures were announced today for the nonfinancial corporate sector. 
Productivity increased 3.0 percent in the first quarter of 2018 and increased 2.5 percent over the last four 
quarters. Unit profits of nonfinancial corporations increased at a 5.5-percent annual rate in the first 
quarter of 2018 and increased 0.3 percent over the last four quarters. (See tables A2 and 6.)

Revised measures

Measures of output for the business, nonfarm business, and nonfinancial corporate sectors, and measures 
of compensation for all sectors incorporate revised National Income and Product Accounts (NIPA) data 
for first-quarter 1947 through first-quarter 2018 released on July 27 by the Bureau of Economic Analysis 
(BEA), U.S. Department of Commerce. As a result, all measures incorporating output and compensation 
were revised, including labor productivity and unit labor costs. The revisions affected both annual and 
quarterly data, with the revisions to quarterly data being more substantial, due to the incorporation of 
improved historical seasonal adjustment methodology by BEA. Measures of output for the 
manufacturing sectors incorporate regular updates of source data for the first quarter of 2018 and the 
fourth quarter of 2017. Hours and related measures were revised back to 2000 for the business and 
nonfarm business sectors due to revised NIPA data on government enterprises employment and on the 
proportion of sector compensation paid to employees of nonprofit institutions. Hours and related 
measures were revised back to 2000 for the nonfinancial corporate sector due to the incorporation of 
revised NIPA data on the proportion of sector compensation paid to employees of corporations. Indexes 
of all measures show historical revisions because the base year was changed from 2009 to 2012; 
resulting revisions to percent changes are small.

Table B1 presents revised and previous labor productivity and related measures for the nonfarm 
business, business, and manufacturing sectors for the first quarter of 2018; table C1 presents annual data 
for the nonfarm business, total manufacturing, and nonfinancial corporate sectors from 2015 to 2017. 

Nonfarm business sector productivity increased 0.3 percent in the first quarter of 2018--similar to 
the previously reported estimate (0.4 percent)--reflecting a 0.1-percentage point downward revision to 
output. (See table B1.) An upward revision to first-quarter unit labor costs--from an increase of 2.9 
percent to an increase of 3.4 percent--reflected a 0.4-percentage point upward revision to hourly 
compensation and a 0.1-pecentage point downward revision to productivity. Real hourly compensation 
increased 0.2 percent after revision, rather than decreasing 0.2 percent as previously published.

Historical revisions to labor productivity in the nonfarm business sector affected the full historical 
period since 1947, with notable periods of upward revision in the latter 1990s and latter 2000s. The 
average annual rate of productivity growth from 2007 to 2017--representing the current business cycle-
-was revised up 0.1 percentage point, to a rate of 1.3 percent. The productivity growth rate over the last 
business cycle, from 2001 to 2007, was also revised up 0.1 percentage point, to a rate of 2.7 percent. 
Earlier business cycle trends also remained largely unchanged. Unit labor costs revisions were also for 
the full historical period since 1947, reflecting both revisions to labor productivity and hourly 
compensation, and show notable downward revisions in the latter 2000s. There was also a large 
upward revision in 2017, due to a large upward revision to hourly compensation in that year.    

Annual average productivity growth in the nonfarm business sector in 2017 was revised down 0.2 
percentage point to an increase of 1.1 percent. Unit labor costs increased 2.2 percent in the nonfarm 
business sector in 2017, rather than increasing 0.4 percent, reflecting both a 1.7-percentage point 
upward revision to hourly compensation and a 0.2-percentage point downward revision to productivity. 
Real hourly compensation increased 1.2 percent in 2017, rather than decreasing 0.5 percent as 
previously reported. (See table C1.)

Manufacturing sector productivity decreased 1.0 percent in the first quarter of 2018--a smaller 
decline than previously reported. Productivity was revised up 0.9 percentage point, to an increase of 0.1 
percent in the durable goods sector, and was revised down 0.5 percentage point, to a decrease of 1.4 
percent in the nondurable goods sector. Unit labor costs increased 5.5 percent in the manufacturing 
sector rather than increasing 5.2 percent as reported June 6. Unit labor costs were revised down 1.2 
percentage points, to an increase of 5.5 percent in the durable goods sector, and were revised up 2.5 
percentage points, to an increase of 3.4 percent in the nondurable goods sector. Total manufacturing 
real hourly compensation increased 0.9 percent, as revised. (See table B1.)
        
Annual average manufacturing productivity grew 0.7 percent in 2017, unrevised from the previously 
reported estimate. Productivity was also unrevised in the manufacturing sector in 2016 and 2015. Unit 
labor costs were revised up to an increase of 2.6 percent in 2017, reflecting a 1.6-percentage point 
upward revision to hourly compensation. After revision, manufacturing real hourly compensation 
increased 1.1 percent in 2017 rather than decreasing 0.4 percent. (See tables C1, 3, 4, and 5.)

Nonfinancial corporate sector productivity growth was revised up in the first quarter of 2018, to an 
increase of 3.0 percent, rather than the previously published increase of 1.9 percent; this revision was 
due solely to a 1.1-percentage point upward revision to output; hours were unrevised. (See table A2.) 

Annual average productivity in the nonfinancial corporate sector increased 1.6 percent in 2017, an 
upward revision from the preliminary estimate of a 1.0-percent increase. (See tables C1 and 6.) Though 
the rate over the current business cycle--from 2007 to 2017--increased at the same 1.0-percent rate as 
was reported June 6, there were notable revisions in some of the years of this period, particularly three 
consecutive 0.3-percentage point upward revisions, in 2011, 2012, and 2013, followed by a 0.9-
percentage point downward revision in 2014. 

Complete annual and quarterly data series can be found on the Productivity and Costs home page: 
www.bls.gov/lpc/#data.
______________
The revised Productivity and Costs news release for second-quarter 2018 is scheduled to be 
released on Thursday, September 6, 2018 at 8:30 a.m. (EDT)



=========================================================================================================================
Table A1. Labor productivity growth and related measures - preliminary second-quarter 2018
(percent change from previous quarter at annual rate and from same quarter a year ago)


                                                Labor                   Hours    Hourly         Real hourly    Unit labor
Sector                  Percent change from:    productivity   Output   worked   compensation   compensation   costs
-------------------------------------------------------------------------------------------------------------------------
Nonfarm business        Previous quarter           2.9          4.8      1.9        2.0             0.3         -0.9
                        A year ago                 1.3          3.5      2.2        3.2             0.5          1.9
                        
Business                Previous quarter           3.6          5.0      1.3        2.4             0.8         -1.1
                        A year ago                 1.4          3.4      2.0        3.4             0.7          1.9
                        
Manufacturing           Previous quarter           0.9          1.9      1.0        1.5            -0.1          0.6
                        A Year ago                -0.2          1.8      2.1        2.5            -0.2          2.7
 Durable
 manufacturing          Previous quarter           0.9          2.4      1.4        1.3            -0.3          0.4
                        A year ago                 0.2          2.3      2.1        2.9             0.2          2.7
 Nondurable
 manufacturing          Previous quarter           1.1          1.5      0.4        1.9             0.2          0.8
                        A year ago                -0.6          1.3      2.0        1.7            -0.9          2.4
=========================================================================================================================

=========================================================================================================================
Table A2. Labor productivity growth and related measures - revised and previously published first-quarter 2018
(percent change from previous quarter at annual rate)    
  
                                                Labor                   Hours    Hourly         Real hourly    Unit labor
Sector                                          productivity   Output   worked   compensation   compensation   costs
-------------------------------------------------------------------------------------------------------------------------       
Nonfinancial          Revised                    3.0          5.3      2.2        4.4             0.9          1.4
corporate       Previously published             1.9          4.2      2.2        3.8             0.3          1.8
=========================================================================================================================

=========================================================================================================================
Table B1. Labor productivity growth and related measures - revised and previously published first-quarter 2018
(percent change from previous quarter at annual rate)
 
                                                Labor                   Hours    Hourly         Real hourly    Unit labor
Sector                                          productivity   Output   worked   compensation   compensation   costs
-------------------------------------------------------------------------------------------------------------------------
Nonfarm Business              Revised              0.3          2.6      2.3        3.7             0.2          3.4
                         Previously published      0.4          2.7      2.3        3.3            -0.2          2.9
                        
Business                      Revised              0.6          2.5      1.9        4.3             0.7          3.7
                         Previously published      0.7          2.6      1.8        3.9             0.4          3.1
                        
Manufacturing                 Revised             -1.0          1.9      2.9        4.4             0.9          5.5
                         Previously published     -1.2          1.7      2.9        3.9             0.4          5.2
 
 Durable                      Revised              0.1          4.1      4.0        5.6             2.0          5.5
 manufacturing          Previously published      -0.8          3.3      4.2        5.8             2.2          6.7
                         
 Nondurable                   Revised             -1.4         -0.5      1.0        2.0            -1.5          3.4
 manufacturing          Previously published      -0.9          0.0      0.9        0.0            -3.4          0.9
=========================================================================================================================
 
=========================================================================================================================
Table C1. Labor productivity growth and related measures – revised and previous annual average changes: 2015-2017


                                                Labor                   Hours    Hourly         Real hourly    Unit labor
Sector           Year                           productivity   Output   worked   compensation   compensation   costs
-------------------------------------------------------------------------------------------------------------------------
Nonfarm          2017           Revised            1.1          2.7      1.6        3.4             1.2          2.2
business                 Previously published      1.3          2.9      1.6        1.7            -0.5          0.4
                         
                                
                 2016           Revised            0.1          1.6      1.5        1.1            -0.2          0.9
                         Previously published      0.0          1.5      1.5        1.1            -0.2          1.1
                         

                 2015           Revised            1.3          3.5      2.1        3.1             2.9          1.8
                         Previously published      1.2          3.4      2.2        3.1             2.9          1.8
                         
                                
Manufacturing    2017           Revised            0.7          1.8      1.0        3.3             1.1          2.6
                         Previously published      0.7          1.8      1.0        1.7            -0.4          1.0
                         
                        
                 2016           Revised            0.3          0.4      0.0        0.6            -0.7          0.3
                         Previously published      0.3          0.4      0.0        0.7            -0.5          0.4
                         

                 2015           Revised           -1.5         -0.6      1.0        2.5             2.4          4.1
                         Previously published     -1.5         -0.6      1.0        2.5             2.3          4.1
                         
                               
Nonfinancial     2017           Revised            1.6          3.4      1.7        3.2             1.0          1.5
corporate                Previously published      1.0          2.8      1.7        1.6            -0.6          0.5
                         

                 2016          Revised             0.0          1.5      1.5        1.1            -0.2          1.0
                        Previously published      -0.1          1.4      1.5        1.1            -0.2          1.2
                        
                        
                 2015           Revised            1.2          3.4      2.2        3.1             2.9          1.8
                         Previously published      1.4          3.6      2.2        3.0             2.8          1.6
=========================================================================================================================




					TECHNICAL NOTES

Labor Hours

Hours data for the labor productivity and cost measures include hours worked for all persons working in 
the sector—wage and salary workers, the self-employed and unpaid family workers. The primary source 
of hours and employment data is the BLS Current Employment Statistics (CES) program, which 
provides monthly survey data on the number of jobs held by wage and salary workers in nonfarm 
establishments, counting a person who is employed by two or more establishments at each place of 
employment. The CES also provides average weekly paid hours of production and nonsupervisory 
workers in these establishments. Weekly paid hours are adjusted to hours worked using data from the 
National Compensation Survey (NCS) for 1996 forward and data from the BLS Hours at Work survey, 
conducted for this purpose, prior to 1990. Between 1990 and 1995, weekly paid hours are adjusted to 
hours at work using a combination of NCS and Hours at Work survey data. The Office of Productivity 
and Technology estimates average weekly hours at work for nonproduction and supervisory workers 
using information from the Current Population Survey (CPS), the CES, and the NCS.

Data from the CPS are used to estimate hours worked for farm labor, nonfarm proprietors, and nonfarm 
unpaid family workers. Using CPS information on employment and hours worked at primary jobs and 
all other jobs, separately, the BLS productivity measures assign all hours worked to the appropriate 
industrial sector. Hours for government enterprises are derived from the CPS, the CES, and the National 
Income and Product Accounts (NIPA) prepared by the Bureau of Economic Analysis (BEA) of the 
Department of Commerce.

Output

Business sector output is a chain-type, current-weighted index constructed after excluding from gross 
domestic product (GDP) the following outputs: general government, nonprofit institutions, and private 
households (including owner-occupied housing). Corresponding exclusions also are made in labor 
hours. Business output accounted for about 76 percent of the value of GDP in 2017. Nonfarm business, 
which excludes farming, accounted for about 75 percent of GDP in 2017.

Annual indexes for manufacturing and its durable and nondurable goods components are constructed by 
deflating current-dollar industry value of production data from the U.S. Bureau of the Census with 
deflators from the BLS. These deflators are based on data from the BLS Producer Price Index program 
and other sources. The industry shipments are aggregated using annual weights, and intrasector 
transactions are removed. Quarterly manufacturing output measures are based on the indexes of 
industrial production prepared monthly by the Board of Governors of the Federal Reserve System, 
adjusted to be consistent with annual indexes of manufacturing sector output prepared by BLS. 

Nonfinancial corporate output is a chain-type, current-weighted index calculated on the basis of the 
costs incurred and the incomes earned from production.  The output measure excludes the following 
outputs from GDP: general government; nonprofit institutions; private households; unincorporated 
business; and those corporations classified as offices of bank holding companies, offices of other 
holding companies, or offices in the finance and insurance sector. Nonfinancial corporations accounted 
for about 49 percent of the value of GDP in 2017. 
     
Labor Productivity

The measure describes the relationship between real output and the labor time involved in its production. 
Measures of labor productivity growth show the changes from period to period in the amount of goods 
and services produced per hour worked. They reflect the joint effects of many influences, including 
changes in technology; capital investment; level of output; utilization of capacity, energy, and materials; 
the organization of production; managerial skill; and the characteristics and effort of the work force.

Labor Compensation

The measure includes accrued wages and salaries, supplements, employer contributions to employee 
benefit plans, and taxes. Estimates of labor compensation by major sector, required for measures of 
hourly compensation and unit labor costs, are based primarily on employee compensation data from the 
NIPA, prepared by the BEA. The compensation of employees in general government, nonprofit 
institutions and private households are subtracted from compensation of employees in domestic 
industries to derive employee compensation for the business sector. The labor compensation of 
proprietors cannot be explicitly identified and must be estimated. This is done by assuming that 
proprietors have the same hourly compensation as employees in the same sector. The quarterly labor 
productivity and cost measures do not contain estimates of compensation for unpaid family workers.  
      
Unit Labor Costs

These measures describe the relationship between compensation per hour and labor productivity, or real 
output per hour, and can be used as an indicator of inflationary pressure on producers. Increases in 
hourly compensation increase unit labor costs; labor productivity increases offset compensation 
increases and lower unit labor costs. 

Presentation of the data

The quarterly data in this release are presented in three ways: as percent changes from the previous 
quarter presented at a compound annual rate, as percent changes from the corresponding quarter of the 
previous year, and as index number series where 2012=100. Annual data are presented both as index 
number series and percent changes from the previous year.  

The index numbers and rates of change reported in the productivity and costs news release are rounded 
to one decimal place. All percent changes in this release and on the BLS web site are calculated using 
index numbers to three decimal places. A complete historical series of these index numbers are available 
at the BLS web site, www.bls.gov/data/home.htm, or by contacting the BLS Division of Major Sector 
Productivity (Telephone 202-691-5606 or email productivity@bls.gov).

For a more detailed explanation of methodology see "Technical Information About the Major Sector 
Productivity and Costs Methods" at www.bls.gov/lpc/lpcmethods.pdf.
      
Information in this release will be made available to sensory-impaired individuals upon request. Voice 
phone: 202-691-5200; Federal Relay Service number: 1-800-877-8339.






Table 1. Business sector: Labor productivity, hourly compensation, unit labor costs, and prices,
seasonally adjusted.
                                                          Real
                                               Hourly     hourly                Unit       Implicit
Year          Labor                            compen-    compen-     Unit      nonlabor   price
and           produc-               Hours      sation     sation      labor     payments   deflator
quarter       tivity     Output     worked     (1)        (2)         costs     (3)        (4)
---------------------------------------------------------------------------------------------------
                      Percent change from previous quarter at annual rate (5)

2018 II        3.6         5.0        1.3        2.4        0.8       -1.1        9.7        3.4  
     I         0.6 r       2.5 r      1.9 r      4.3 r      0.7 r      3.7 r     -0.4 r      1.9 r

2017 ANNUAL    1.1 r       2.6 r      1.5        3.4 r      1.2 r      2.3 r      1.0 r      1.7 r

2017 IV       -1.1 r       2.9 r      4.1        1.2 r     -2.1 r      2.4 r      3.6 r      2.9 r
     III       2.8 r       3.5 r      0.7        5.6 r      3.4 r      2.8 r      0.9 r      2.0 r
     II        1.6         3.7        2.1        1.3 r      1.2 r     -0.3 r      2.3 r      0.8 r
     I        -0.2 r       1.9 r      2.0        4.0 r      1.0 r      4.2 r     -1.3 r      1.8 r

2016 ANNUAL    0.2 r       1.7 r      1.5        1.0 r     -0.2        0.9 r      0.9 r      0.9 r

2016 IV        1.9         2.2        0.3        5.6 r      2.7 r      3.6 r     -0.6 r      1.7 r
     III       1.6 r       2.2 r      0.6 r      2.5 r      0.6 r      0.9 r      1.7 r      1.3 r
     II        0.7 r       2.6        1.9 r      0.3 r     -2.3 r     -0.4 r      7.7 r      3.1 r
     I         0.2 r       1.6 r      1.4        0.0 r      0.1 r     -0.2 r     -1.5 r     -0.8 r
---------------------------------------------------------------------------------------------------
                    Percent change from corresponding quarter of previous year

2018 II        1.4         3.4        2.0        3.4        0.7        1.9        3.4        2.5  
     I         0.9 r       3.1 r      2.2        3.1 r      0.8 r      2.1 r      1.6 r      1.9 r

2017 ANNUAL    1.1 r       2.6 r      1.5        3.4 r      1.2 r      2.3 r      1.0 r      1.7 r

2017 IV        0.8 r       3.0 r      2.2        3.0 r      0.9 r      2.3 r      1.4 r      1.9 r
     III       1.5         2.8        1.3        4.1 r      2.1 r      2.6 r      0.3 r      1.6  
     II        1.2 r       2.5 r      1.3        3.3 r      1.4 r      2.1 r      0.5 r      1.4  
     I         1.0 r       2.2 r      1.2        3.1 r      0.5 r      2.1 r      1.8 r      2.0 r

2016 ANNUAL    0.2 r       1.7 r      1.5        1.0 r     -0.2        0.9 r      0.9 r      0.9 r

2016 IV        1.1         2.1        1.0        2.1 r      0.3 r      1.0 r      1.8 r      1.3 r
     III      -0.1         1.6        1.8        0.5 r     -0.7 r      0.6 r      1.0 r      0.8 r
     II       -0.4         1.3 r      1.6        0.4 r     -0.7 r      0.7 r      0.9 r      0.8 r
     I         0.1 r       1.6 r      1.6        1.2 r      0.1 r      1.2 r     -0.2 r      0.6 r
---------------------------------------------------------------------------------------------------
                                         Indexes 2012=100

2018 II      105.4       117.5      111.4      114.9      105.1      109.0      108.5      108.8  
     I       104.5 r     116.0 r    111.1 r    114.2 r    104.9 r    109.3 r    106.0 r    107.9 r

2017 ANNUAL  104.1 r     114.0 r    109.5 r    111.9 r    104.6 r    107.5 r    105.1 r    106.5 r

2017 IV      104.3 r     115.3 r    110.6 r    113.0 r    104.7 r    108.3 r    106.1 r    107.4 r
     III     104.6 r     114.5 r    109.5 r    112.7 r    105.3 r    107.7 r    105.1 r    106.6 r
     II      103.9 r     113.5 r    109.3 r    111.2 r    104.4 r    107.0 r    104.9 r    106.1 r
     I       103.5 r     112.5 r    108.7 r    110.8 r    104.1 r    107.0 r    104.3 r    105.8 r

2016 ANNUAL  102.9 r     111.1 r    107.9 r    108.2 r    103.4 r    105.2 r    104.1 r    104.7 r

2016 IV      103.5 r     112.0 r    108.2 r    109.7 r    103.8 r    105.9 r    104.6 r    105.4 r
     III     103.1 r     111.4 r    108.1 r    108.2 r    103.1 r    105.0 r    104.8 r    104.9 r
     II      102.7 r     110.8 r    107.9 r    107.6 r    103.0 r    104.8 r    104.4 r    104.6 r
     I       102.5 r     110.1 r    107.4 r    107.5 r    103.6 r    104.9 r    102.4 r    103.8 r
---------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                                    August 15, 2018
r=revised                                                        Source: Bureau of Labor Statistics



Table 2. Nonfarm business sector: Labor productivity, hourly compensation, unit labor costs, and
prices, seasonally adjusted.
                                                          Real
                                               Hourly     hourly                Unit       Implicit
Year          Labor                            compen-    compen-     Unit      nonlabor   price
and           produc-               Hours      sation     sation      labor     payments   deflator
quarter       tivity     Output     worked     (1)        (2)         costs     (3)        (4)
---------------------------------------------------------------------------------------------------
                      Percent change from previous quarter at annual rate (5)

2018 II        2.9         4.8        1.9        2.0        0.3       -0.9        9.6        3.5  
     I         0.3 r       2.6 r      2.3        3.7 r      0.2 r      3.4 r     -0.3 r      1.8 r

2017 ANNUAL    1.1 r       2.7 r      1.6        3.4 r      1.2 r      2.2 r      0.9 r      1.6 r

2017 IV       -0.3 r       3.0 r      3.3        1.9 r     -1.3 r      2.3 r      3.7 r      2.9 r
     III       2.3 r       3.6 r      1.3        5.1 r      2.9 r      2.8 r      1.1 r      2.1 r
     II        1.6 r       3.8 r      2.2        1.3 r      1.2 r     -0.3 r      2.3 r      0.8 r
     I         0.4 r       1.9 r      1.5        4.7 r      1.6 r      4.2 r     -2.4 r      1.3 r

2016 ANNUAL    0.1 r       1.6 r      1.5        1.1       -0.2        0.9 r      1.2 r      1.1 r

2016 IV        1.3 r       2.3 r      1.0        4.7 r      1.9 r      3.4 r     -0.1 r      1.8 r
     III       1.3 r       2.2 r      0.9        2.2 r      0.3 r      0.9 r      2.2 r      1.5 r
     II        0.9 r       2.5        1.6 r      0.7 r     -2.0 r     -0.2 r      7.8 r      3.2 r
     I         0.3 r       1.6 r      1.3        0.1 r      0.1 r     -0.2 r     -0.5 r     -0.3 r
---------------------------------------------------------------------------------------------------
                    Percent change from corresponding quarter of previous year

2018 II        1.3         3.5        2.2        3.2        0.5        1.9        3.5        2.6  
     I         1.0 r       3.2 r      2.3        3.0 r      0.7 r      2.0 r      1.7 r      1.9 r

2017 ANNUAL    1.1 r       2.7 r      1.6        3.4 r      1.2 r      2.2 r      0.9 r      1.6 r

2017 IV        1.0 r       3.1 r      2.1        3.2 r      1.1 r      2.2 r      1.1 r      1.8 r
     III       1.4         2.9 r      1.5        3.9 r      1.9 r      2.5 r      0.2 r      1.5  
     II        1.2 r       2.6 r      1.4        3.2 r      1.3 r      2.0 r      0.5 r      1.4 r
     I         1.0 r       2.2 r      1.2        3.1 r      0.5 r      2.0 r      1.8 r      1.9 r

2016 ANNUAL    0.1 r       1.6 r      1.5        1.1       -0.2        0.9 r      1.2 r      1.1 r

2016 IV        1.0 r       2.1        1.2        1.9 r      0.1 r      0.9 r      2.3 r      1.5 r
     III      -0.1         1.6        1.7        0.6 r     -0.6 r      0.7 r      1.5 r      1.0 r
     II       -0.3 r       1.2 r      1.5        0.5 r     -0.6 r      0.8 r      1.2 r      1.0 r
     I         0.0 r       1.6 r      1.6        1.2 r      0.1 r      1.2 r      0.0 r      0.7 r
---------------------------------------------------------------------------------------------------
                                         Indexes 2012=100

2018 II      105.1       117.3      111.6      114.9      105.1      109.3      109.3      109.3  
     I       104.3 r     115.9 r    111.1 r    114.3 r    105.0 r    109.6 r    106.8 r    108.4 r

2017 ANNUAL  103.9 r     113.8 r    109.5 r    112.1 r    104.8 r    107.9 r    105.9 r    107.0 r

2017 IV      104.3 r     115.2 r    110.5 r    113.3 r    105.0 r    108.7 r    106.9 r    107.9 r
     III     104.3 r     114.3 r    109.6 r    112.8 r    105.3 r    108.1 r    105.9 r    107.1 r
     II      103.8 r     113.3 r    109.2 r    111.4 r    104.6 r    107.3 r    105.6 r    106.6 r
     I       103.4 r     112.3 r    108.6 r    111.0 r    104.3 r    107.4 r    105.0 r    106.4 r

2016 ANNUAL  102.8 r     110.8 r    107.8 r    108.5 r    103.6 r    105.5 r    104.9 r    105.3 r

2016 IV      103.2 r     111.7 r    108.2 r    109.7 r    103.9 r    106.3 r    105.7 r    106.0 r
     III     102.9 r     111.1 r    108.0 r    108.5 r    103.4 r    105.4 r    105.7 r    105.6 r
     II      102.6 r     110.5 r    107.7 r    107.9 r    103.3 r    105.2 r    105.1 r    105.2 r
     I       102.3 r     109.8 r    107.3 r    107.7 r    103.8 r    105.2 r    103.2 r    104.4 r
---------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                                    August 15, 2018
r=revised                                                        Source: Bureau of Labor Statistics



Table 3. Manufacturing sector: Labor productivity, hourly compensation, and unit labor costs,
seasonally adjusted.
                                                                             Real
Year              Labor                                       Hourly         hourly          Unit
and               produc-                      Hours          compensa-      compensa-       labor
quarter           tivity        Output         worked         tion (1)       tion (2)        costs
---------------------------------------------------------------------------------------------------
                      Percent change from previous quarter at annual rate (5)

2018 II            0.9            1.9            1.0            1.5           -0.1            0.6  
     I            -1.0 r          1.9 r          2.9            4.4 r          0.9 r          5.5 r

2017 ANNUAL        0.7            1.8            1.0            3.3 r          1.1 r          2.6 r

2017 IV            4.4 r          5.5 r          1.1            1.6 r         -1.7 r         -2.7 r
     III          -5.0           -1.9            3.3            2.4 r          0.3 r          7.8 r
     II            3.5            2.9           -0.6            3.0 r          2.9 r         -0.5 r
     I            -0.3 r          2.2            2.5            3.9 r          0.9 r          4.2 r

2016 ANNUAL        0.3            0.4            0.0            0.6 r         -0.7 r          0.3 r

2016 IV            2.6            2.4           -0.3            5.8 r          3.0 r          3.0 r
     III           0.6            1.7            1.1            1.8 r         -0.1 r          1.2 r
     II           -0.8 r         -1.1           -0.2            1.5 r         -1.2 r          2.3 r
     I             2.5            1.8           -0.6           -2.7 r         -2.6 r         -5.0 r
---------------------------------------------------------------------------------------------------
                    Percent change from corresponding quarter of previous year

2018 II           -0.2            1.8            2.1            2.5           -0.2            2.7  
     I             0.4 r          2.1 r          1.6 r          2.8 r          0.6            2.4 r

2017 ANNUAL        0.7            1.8            1.0            3.3 r          1.1 r          2.6 r

2017 IV            0.6            2.1            1.5            2.7 r          0.6 r          2.1 r
     III           0.2            1.4            1.2            3.8 r          1.7 r          3.6 r
     II            1.6            2.3            0.7            3.6 r          1.7 r          2.0 r
     I             0.5            1.3            0.8            3.2 r          0.6 r          2.7 r

2016 ANNUAL        0.3            0.4            0.0            0.6 r         -0.7 r          0.3 r

2016 IV            1.2            1.2            0.0            1.6 r         -0.3 r          0.3 r
     III          -0.2            0.3            0.4           -0.2 r         -1.3 r          0.0 r
     II            0.2            0.0           -0.2            0.4 r         -0.7 r          0.2 r
     I             0.1           -0.1           -0.1            0.6 r         -0.5 r          0.6 r
---------------------------------------------------------------------------------------------------
                                         Indexes 2012=100

2018 II          100.8          106.9          106.1          112.6          103.0          111.7  
     I           100.6 r        106.4 r        105.8 r        112.2 r        103.0 r        111.5 r

2017 ANNUAL      100.4 r        104.9 r        104.5 r        110.1 r        102.9 r        109.6 r

2017 IV          100.8 r        105.9 r        105.1 r        111.0 r        102.8 r        110.1 r
     III          99.7 r        104.5 r        104.8 r        110.5 r        103.3 r        110.8 r
     II          101.0 r        105.0 r        104.0 r        109.9 r        103.2 r        108.8 r
     I           100.2 r        104.3 r        104.1 r        109.1 r        102.5 r        108.9 r

2016 ANNUAL       99.7 r        103.1 r        103.4 r        106.6 r        101.8 r        106.9 r

2016 IV          100.2 r        103.7 r        103.5 r        108.0 r        102.2 r        107.8 r
     III          99.6 r        103.1 r        103.5 r        106.5 r        101.5 r        107.0 r
     II           99.4 r        102.7 r        103.3 r        106.1 r        101.5 r        106.7 r
     I            99.6 r        103.0 r        103.3 r        105.7 r        101.8 r        106.0 r
---------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                                    August 15, 2018
r=revised                                                        Source: Bureau of Labor Statistics



Table 4. Durable manufacturing sector: Labor productivity, hourly compensation, and unit labor
costs, seasonally adjusted.
                                                                             Real
Year              Labor                                       Hourly         hourly          Unit
and               produc-                      Hours          compensa-      compensa-       labor
quarter           tivity        Output         worked         tion (1)       tion (2)        costs
---------------------------------------------------------------------------------------------------
                      Percent change from previous quarter at annual rate (5)

2018 II            0.9            2.4            1.4            1.3           -0.3            0.4  
     I             0.1 r          4.1 r          4.0 r          5.6 r          2.0 r          5.5 r

2017 ANNUAL        1.1            1.7            0.6            4.1 r          1.9 r          2.9 r

2017 IV            4.8 r          5.2 r          0.4            2.2 r         -1.1 r         -2.4 r
     III          -4.8           -2.3            2.6            2.4 r          0.3 r          7.6 r
     II            4.6 r          2.1           -2.3 r          6.1 r          6.0 r          1.5 r
     I            -0.8 r          2.8            3.6 r          3.4 r          0.4 r          4.2 r

2016 ANNUAL       -0.8           -1.2           -0.4            0.9 r         -0.3 r          1.8 r

2016 IV            3.1            2.5           -0.6            6.8 r          4.0 r          3.6 r
     III           1.9            2.2            0.3            2.2 r          0.4 r          0.3 r
     II           -0.4           -1.9           -1.5            1.9 r         -0.8 r          2.3 r
     I            -1.2           -1.1            0.1           -2.1 r         -2.0 r         -0.9 r
---------------------------------------------------------------------------------------------------
                    Percent change from corresponding quarter of previous year

2018 II            0.2            2.3            2.1            2.9            0.2            2.7  
     I             1.1 r          2.2 r          1.1 r          4.1 r          1.8 r          2.9 r

2017 ANNUAL        1.1            1.7            0.6            4.1 r          1.9 r          2.9 r

2017 IV            0.9 r          1.9            1.0            3.5 r          1.4 r          2.6 r
     III           0.5            1.2            0.8            4.7 r          2.6 r          4.2 r
     II            2.2            2.4            0.2            4.6 r          2.6 r          2.4 r
     I             0.9            1.4            0.4 r          3.6 r          0.9 r          2.6 r

2016 ANNUAL       -0.8           -1.2           -0.4            0.9 r         -0.3 r          1.8 r

2016 IV            0.8            0.4           -0.4            2.2 r          0.3 r          1.3 r
     III          -1.3           -1.4            0.0            0.2 r         -0.9 r          1.6 r
     II           -1.4           -2.0           -0.7            0.7 r         -0.4 r          2.1 r
     I            -1.5           -1.9           -0.4            0.7           -0.4            2.2  
---------------------------------------------------------------------------------------------------
                                         Indexes 2012=100

2018 II          101.4          107.3          105.8          113.7          104.0          112.1  
     I           101.2 r        106.7 r        105.4 r        113.3 r        104.1 r        112.0 r

2017 ANNUAL      100.6 r        104.8 r        104.2 r        110.6 r        103.4 r        110.0 r

2017 IV          101.1 r        105.6 r        104.4 r        111.8 r        103.6 r        110.5 r
     III         100.0 r        104.3 r        104.3 r        111.2 r        103.9 r        111.2 r
     II          101.2 r        104.9 r        103.6 r        110.5 r        103.8 r        109.2 r
     I           100.1 r        104.3 r        104.3 r        108.9 r        102.3 r        108.8 r

2016 ANNUAL       99.5 r        103.0 r        103.5 r        106.3 r        101.5 r        106.8 r

2016 IV          100.3 r        103.6 r        103.3 r        108.0 r        102.2 r        107.7 r
     III          99.5 r        103.0 r        103.5 r        106.2 r        101.2 r        106.8 r
     II           99.0 r        102.4 r        103.4 r        105.7 r        101.1 r        106.7 r
     I            99.1 r        102.9 r        103.8 r        105.2 r        101.3 r        106.1 r
---------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                                    August 15, 2018
r=revised                                                        Source: Bureau of Labor Statistics



Table 5. Nondurable manufacturing sector: Labor productivity, hourly compensation, and unit labor
costs, seasonally adjusted.
                                                                             Real
Year              Labor                                       Hourly         hourly          Unit
and               produc-                      Hours          compensa-      compensa-       labor
quarter           tivity        Output         worked         tion (1)       tion (2)        costs
---------------------------------------------------------------------------------------------------
                      Percent change from previous quarter at annual rate (5)

2018 II            1.1            1.5            0.4            1.9            0.2            0.8  
     I            -1.4 r         -0.5 r          1.0 r          2.0 r         -1.5 r          3.4 r

2017 ANNUAL       -0.2            1.6            1.8            2.0 r         -0.2 r          2.2 r

2017 IV            3.5            5.8            2.2            0.5 r         -2.8 r         -2.9 r
     III          -5.5           -1.4            4.3            2.6 r          0.5 r          8.6 r
     II            1.2 r          3.7            2.4 r         -2.5 r         -2.6 r         -3.7 r
     I             0.8 r          1.5            0.7 r          4.6 r          1.6 r          3.8 r

2016 ANNUAL        0.7            1.4            0.7            0.0 r         -1.2           -0.6  

2016 IV            1.7            1.9            0.2            3.9 r          1.2 r          2.2 r
     III          -1.9            0.5            2.4            1.1 r         -0.7 r          3.1 r
     II           -3.2           -1.2            2.0            0.9 r         -1.7 r          4.2 r
     I             5.8 r          3.7           -1.9           -3.9 r         -3.9 r         -9.1 r
---------------------------------------------------------------------------------------------------
                    Percent change from corresponding quarter of previous year

2018 II           -0.6            1.3            2.0            1.7           -0.9            2.4  
     I            -0.6 r          1.9 r          2.5            0.6 r         -1.6 r          1.2 r

2017 ANNUAL       -0.2            1.6            1.8            2.0 r         -0.2 r          2.2 r

2017 IV           -0.1            2.4            2.4            1.3 r         -0.8 r          1.3 r
     III          -0.5            1.4            1.9            2.1 r          0.2 r          2.6 r
     II            0.4            1.9            1.4            1.8 r         -0.1 r          1.3 r
     I            -0.7 r          0.6            1.3            2.6 r          0.1 r          3.3 r

2016 ANNUAL        0.7            1.4            0.7            0.0 r         -1.2           -0.6  

2016 IV            0.5            1.2            0.7            0.5 r         -1.3 r          0.0 r
     III           0.0            1.2            1.2           -0.9 r         -2.0 r         -0.8 r
     II            0.9            1.5            0.7            0.0 r         -1.1 r         -0.8 r
     I             1.4            1.8            0.4            0.5 r         -0.6 r         -0.9 r
---------------------------------------------------------------------------------------------------
                                         Indexes 2012=100

2018 II          100.6          107.2          106.6          110.6          101.2          109.9  
     I           100.4 r        106.8 r        106.5 r        110.0 r        101.1 r        109.7 r

2017 ANNUAL      100.7 r        105.8 r        105.0 r        109.2 r        102.1 r        108.5 r

2017 IV          100.7 r        107.0 r        106.2 r        109.5 r        101.5 r        108.7 r
     III          99.8 r        105.5 r        105.6 r        109.4 r        102.2 r        109.6 r
     II          101.3 r        105.8 r        104.5 r        108.7 r        102.1 r        107.3 r
     I           101.0 r        104.9 r        103.9 r        109.4 r        102.7 r        108.3 r

2016 ANNUAL      100.9 r        104.1 r        103.2 r        107.1 r        102.3 r        106.2 r

2016 IV          100.8 r        104.5 r        103.7 r        108.1 r        102.3 r        107.3 r
     III         100.3 r        104.0 r        103.6 r        107.1 r        102.0 r        106.7 r
     II          100.8 r        103.9 r        103.0 r        106.8 r        102.2 r        105.9 r
     I           101.6 r        104.2 r        102.5 r        106.5 r        102.7 r        104.8 r
---------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                                    August 15, 2018
r=revised                                                        Source: Bureau of Labor Statistics



Table 6. Nonfinancial corporate sector: Labor productivity, hourly compensation, unit labor costs,
unit profits, and prices, seasonally adjusted.
                                                     Real
                                           Hourly    hourly            Unit      Total           Implicit
Year         Labor                         compen-   compen-   Unit    nonlabor  unit    Unit    price
and          produc-             Hours     sation    sation    labor   costs     costs   profits deflator
quarter      tivity    Output    worked    (1)       (2)       costs   (6)       (7)     (8)     (4)
---------------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate (5)

2018 I         3.0 r     5.3 r    2.2       4.4 r     0.9 r     1.4 r   -1.0 r    0.6 r    5.5 r    1.2 r

2017 ANNUAL    1.6 r     3.4 r    1.7       3.2 r     1.0 r     1.5 r    1.0 r    1.3 r   -2.1 r    0.9 r

2017 IV        1.4 r     4.2 r    2.7       0.3 r    -2.9 r    -1.1 r    0.5 r   -0.6 r    7.8 r    0.4 r
     III       1.1 r     2.5 r    1.5       2.8 r     0.6 r     1.7 r    0.6 r    1.3 r  -17.1 r   -1.2 r
     II        4.5 r     7.4 r    2.7      -0.1 r    -0.2 r    -4.4 r   -2.4 r   -3.7 r    7.5 r   -2.4 r
     I         3.1 r     5.0 r    1.8       8.1 r     5.0 r     4.9 r    0.0 r    3.2 r   10.6 r    4.1 r

2016 ANNUAL    0.0 r     1.5 r    1.5       1.1      -0.2       1.0 r    0.1 r    0.7     -6.8 r   -0.3 r

2016 IV       -2.4 r    -1.7 r    0.7       3.4 r     0.6 r     6.0 r    7.6 r    6.5 r   -9.1 r    4.4 r
     III       4.7 r     6.3 r    1.5       1.5 r    -0.4 r    -3.1 r   -3.6 r   -3.3 r   -5.4 r   -3.5 r
     II       -4.8 r    -3.6 r    1.3       0.3 r    -2.4 r     5.4 r    6.5 r    5.8 r  -21.8 r    1.6 r
     I         3.3 r     3.8 r    0.5 r     2.0 r     2.1 r    -1.2 r  -14.3 r   -5.7 r   31.2 r   -1.5 r
---------------------------------------------------------------------------------------------------------
                       Percent change from corresponding quarter of previous year

2018 I         2.5 r     4.8 r    2.3       1.8 r    -0.4 r    -0.6 r   -0.6 r   -0.6 r    0.3 r   -0.5 r

2017 ANNUAL    1.6 r     3.4 r    1.7       3.2 r     1.0 r     1.5 r    1.0 r    1.3 r   -2.1 r    0.9 r

2017 IV        2.5 r     4.8 r    2.2       2.7 r     0.6 r     0.2 r   -0.3 r    0.0 r    1.5 r    0.2 r
     III       1.5 r     3.2 r    1.7       3.5 r     1.5 r     1.9 r    1.4 r    1.8 r   -2.7 r    1.2 r
     II        2.4 r     4.2 r    1.7       3.2 r     1.3 r     0.7 r    0.3 r    0.6 r    0.5 r    0.6 r
     I         0.1 r     1.4 r    1.3       3.3 r     0.7 r     3.2 r    2.5 r    3.0 r   -7.1 r    1.6 r

2016 ANNUAL    0.0 r     1.5 r    1.5       1.1      -0.2       1.0 r    0.1 r    0.7     -6.8 r   -0.3 r

2016 IV        0.1 r     1.1 r    1.0       1.8 r     0.0 r     1.7 r   -1.4 r    0.7 r   -3.1 r    0.2 r
     III       0.3 r     1.9 r    1.6       0.7 r    -0.5 r     0.4 r    0.2 r    0.4    -11.6 r   -1.4 r
     II       -0.7 r     1.0 r    1.7       0.6 r    -0.5 r     1.2 r    1.1 r    1.2 r   -7.7 r    0.0 r
     I         0.3 r     2.0 r    1.7       1.2       0.1       0.9 r    0.4 r    0.7 r   -4.4 r    0.0 r
---------------------------------------------------------------------------------------------------------
                                            Indexes 2012=100

2018 I       105.2 r   118.0 r  112.2 r   113.4 r   104.2 r   107.8 r  103.8 r  106.5 r   91.9 r  104.4 r

2017 ANNUAL  103.7 r   114.7 r  110.6 r   111.7 r   104.5 r   107.7 r  104.1 r  106.5 r   91.2 r  104.3 r

2017 IV      104.4 r   116.5 r  111.5 r   112.2 r   104.0 r   107.4 r  104.1 r  106.3 r   90.7 r  104.1 r
     III     104.1 r   115.3 r  110.8 r   112.1 r   104.7 r   107.7 r  104.0 r  106.5 r   89.0 r  104.0 r
     II      103.8 r   114.6 r  110.4 r   111.3 r   104.6 r   107.3 r  103.8 r  106.1 r   93.3 r  104.3 r
     I       102.6 r   112.6 r  109.7 r   111.4 r   104.6 r   108.5 r  104.4 r  107.1 r   91.6 r  104.9 r

2016 ANNUAL  102.1 r   111.0 r  108.7 r   108.3 r   103.4 r   106.1 r  103.1 r  105.1 r   93.1 r  103.4 r

2016 IV      101.9 r   111.2 r  109.2 r   109.2 r   103.3 r   107.2 r  104.4 r  106.3 r   89.4 r  103.9 r
     III     102.5 r   111.7 r  109.0 r   108.3 r   103.2 r   105.7 r  102.5 r  104.6 r   91.5 r  102.8 r
     II      101.3 r   110.0 r  108.6 r   107.9 r   103.3 r   106.5 r  103.5 r  105.5 r   92.8 r  103.7 r
     I       102.6 r   111.0 r  108.2 r   107.8 r   103.9 r   105.1 r  101.9 r  104.0 r   98.7 r  103.3 r
---------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                                          August 15, 2018
r=revised                                                              Source: Bureau of Labor Statistics



SOURCES: Output data are from the Bureau of Economic Analysis and the Census Bureau of the U.S. 
Department of Commerce; the Bureau of Labor Statistics, U.S. Department of Labor; and the Federal 
Reserve Board. Hours and compensation data are from the Bureau of Labor Statistics and the Bureau of 
Economic Analysis.

RELIABILITY: Productivity and cost measures are regularly revised as more complete information 
becomes available.  The measures are first published within 40 days of the close of the reference period; 
revisions appear 30 days later, and second revisions after an additional 60 days.  In the business sector, 
the third publication (second revision) of a quarterly index of output per hour of all persons has differed 
from the initial value by between -1.5 and 1.4 index points approximately 95 percent of the time. This 
interval is based on the performance of this measure between the fourth quarter of 1995 and the first 
quarter of 2018.

					Table Footnotes

(1) Wages and salaries of employees plus employers' contributions for social insurance and private 
benefit plans. Except for nonfinancial corporations, where there are no self-employed, data also include 
an estimate of wages, salaries, and supplemental payments for the self-employed.

(2) The change for recent quarters is based on the Consumer Price Index for all urban consumers 
(CPI-U). The trend from 1978-2017 is based on the Consumer Price Index research series (CPI-U-RS).

(3) Unit nonlabor payments include profits, consumption of fixed capital, taxes on production and 
imports less subsidies, net interest and miscellaneous payments, business current transfer payments, 
rental income of persons, and the current surplus of government enterprises.

(4) Current dollar output divided by the output index.

(5) Quarterly changes: Percent change compounded at annual rate is calculated using index numbers to 
three decimal places. Indexes published in the news release are rounded to one decimal place for 
convenience. Annual changes: Percent change is calculated using annual indexes to three decimal 
places.

(6) Unit nonlabor costs include consumption of fixed capital, taxes on production and imports less 
subsidies, net interest and miscellaneous payments, and business current transfer payments.

(7) Total unit costs are the sum of unit labor and nonlabor costs.

(8) Unit profits include corporate profits before tax with inventory valuation and capital consumption 
adjustments.



Last Modified Date: August 15, 2018