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Productivity and Costs, Second Quarter 2019, Revised



Transmission of material in this release is embargoed until                                   USDL 19-1572
8:30 a.m. (EDT) Thursday, September 5, 2019

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 2019, Revised

Nonfarm business sector labor productivity increased 2.3 percent in the second quarter of 2019, the 
U.S. Bureau of Labor Statistics reported today, as output increased 1.9 percent and hours worked 
decreased 0.4 percent. (All quarterly percent changes in this release are seasonally adjusted annual 
rates.) From the second quarter of 2018 to the second quarter of 2019, productivity increased 1.8 
percent, reflecting a 2.6-percent increase in output and a 0.9-percent increase in hours worked. The four-
quarter increase in hours is the lowest estimate since the second quarter of 2010 (-0.3 percent). (See 
table A1.) 

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 increased 2.6 percent in the second quarter of 2019, and 
increased 2.6 percent over the last four quarters. (See table 2.) 

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 decreased 2.2 percent in the second quarter of 2019, as 
output decreased 3.0 percent and hours worked declined 0.8 percent. This is the second consecutive 
quarter with declines in both output and hours in the manufacturing sector; in the first quarter of 2019 
output declined 1.8 percent and hours declined 2.9 percent. This is the first occurrence of two 
consecutive quarters of declines in both output and hours in manufacturing since the second quarter of 
2009.

Productivity declined 0.6 percent in the durable manufacturing sector in the second quarter of 2019, 
reflecting a 1.9-percent decrease in output and a 1.4-percent decrease in hours worked. Productivity 
decreased 4.4 percent in the nondurable manufacturing sector as output fell 4.2 percent and hours 
worked rose 0.1 percent. Over the last four quarters, total manufacturing sector productivity was 
unchanged, as output increased 0.2 percent and hours worked increased 0.1 percent. Unit labor costs in 
the manufacturing sector increased 6.7 percent in the second quarter of 2019, and increased 4.5 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. 

Preliminary second-quarter 2019 measures of productivity and costs were announced for the 
nonfinancial corporate sector. Labor productivity increased 2.8 percent in the second quarter of 2019, 
as output increased 3.1 percent and hours worked increased 0.3 percent. Unit labor costs increased 2.2 
percent, as hourly compensation increased 5.1 percent and productivity increased 2.8 percent. Unit 
profits increased at a 13.2-percent annual rate in the second quarter of 2019. (See tables A2 and 6.)

Revised measures

The measures released today are based on more recent source data than were available for the 
preliminary report. Table B1 presents previous and revised productivity and related measures for the 
nonfarm business, business, and manufacturing sectors. 

In the second quarter of 2019, nonfarm business productivity increased 2.3 percent--the same as the 
preliminary estimate. Unit labor costs increased 2.6 percent, a slightly larger increase than previously 
reported. Manufacturing sector productivity was revised down to a decrease of 2.2 percent from a 
previously-reported decrease of 1.6 percent. Unit labor costs increased 6.7 percent, rather than 
increasing 5.8 percent as previously reported. Durable manufacturing productivity was revised up to a 
decline of 0.6 percent, smaller than the previously-reported decline of 0.9 percent; nondurable 
manufacturing productivity was revised down to a decline of 4.4 percent, from a previously-reported 
decline of 2.6 percent. 

Table B2 shows previous and revised labor productivity and related measures for the nonfarm business, 
business, manufacturing and nonfinancial corporate sectors for the first quarter of 2019.

In the first quarter of 2019, nonfarm business productivity was not revised. Unit labor costs were 
revised up slightly to an increase of 5.7 percent. Manufacturing sector productivity was revised up 
slightly to an increase of 1.2 percent. Unit labor costs were revised up slightly to an increase of 6.9 
percent.

In the nonfinancial corporate sector, first-quarter 2019 productivity was revised up slightly to an 
increase of 1.6 percent. Unit profits were revised down slightly to a decline of 33.7 percent. (See tables 
B2 and 6.) 

Complete annual and quarterly data series can be found on the Productivity and Costs home page: 
www.bls.gov/lpc/#data.
______________
The preliminary Productivity and Costs news release for third-quarter 2019 is scheduled to be 
released on Wednesday, November 6, 2019 at 8:30 a.m. (EST).





=========================================================================================================================
Table A1. Labor productivity growth and related measures  revised second-quarter 2019
(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           2.3          1.9     -0.4        4.9             1.9          2.6
                        A year ago                 1.8          2.6      0.9        4.4             2.5          2.6
                        
Business                Previous quarter           2.6          2.1     -0.5        5.2             2.2          2.5
                        A year ago                 1.7          2.7      0.9        4.4             2.5          2.6
                        
Manufacturing           Previous quarter          -2.2         -3.0     -0.8        4.3             1.3          6.7
                        A Year ago                 0.0          0.2      0.1        4.5             2.7          4.5
 Durable
 manufacturing          Previous quarter          -0.6         -1.9     -1.4        4.6             1.6          5.2
                        A year ago                 0.8          1.4      0.6        4.5             2.6          3.6
 Nondurable
 manufacturing          Previous quarter          -4.4         -4.2      0.1        3.9             0.9          8.6
                        A year ago                -0.5         -1.1     -0.6        4.6             2.7          5.1
=========================================================================================================================


=========================================================================================================================
Table A2. Labor productivity growth and related measures  preliminary second-quarter 2019
(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
-------------------------------------------------------------------------------------------------------------------------
Nonfinancial         Previous quarter              2.8          3.1      0.3        5.1             2.1          2.2
corporate            A year ago                    2.6          3.9      1.2        3.9             2.1          1.3
=========================================================================================================================


=========================================================================================================================
Table B1. Labor productivity growth and related measures - revised and previously published second-quarter 2019
(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                    2.3          1.9     -0.4        4.9             1.9          2.6
                   Previously published            2.3          1.9     -0.4        4.8             1.8          2.4
                        
Business                Revised                    2.6          2.1     -0.5        5.2             2.2          2.5
                   Previously published            2.6          2.1     -0.5        5.0             2.0          2.3
                        
Manufacturing           Revised                   -2.2         -3.0     -0.8        4.3             1.3          6.7
                   Previously published           -1.6         -2.1     -0.5        4.1             1.1          5.8

 Durable                Revised                   -0.6         -1.9     -1.4        4.6             1.6          5.2
 manufacturing     Previously published           -0.9         -1.8     -0.9        4.5             1.5          5.5
                        
 Nondurable             Revised                   -4.4         -4.2      0.1        3.9             0.9          8.6
 manufacturing     Previously published           -2.6         -2.4      0.3        3.5             0.5          6.3
=========================================================================================================================


=========================================================================================================================
Table B2. Labor productivity growth and related measures  revised and previously published first-quarter 2019
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                    3.5          3.9      0.4        9.4             8.4          5.7
                   Previously published            3.5          3.9      0.4        9.2             8.3          5.5
                        
Business                Revised                    3.6          3.9      0.3        9.5             8.5          5.7
                   Previously published            3.6          3.9      0.3        9.3             8.4          5.5
                        
Manufacturing           Revised                    1.2         -1.8     -2.9        8.2             7.2          6.9
                   Previously published            1.1         -1.8     -2.9        8.0             7.1          6.8
 Durable
 manufacturing          Revised                    0.0         -2.8     -2.8        8.6             7.6          8.6
                   Previously published            0.1         -2.7     -2.8        8.4             7.5          8.4
 Nondurable
 manufacturing          Revised                    2.6         -0.7     -3.2        7.3             6.3          4.6
                   Previously published            2.4         -0.8     -3.2        7.3             6.3          4.7

Nonfinancial            Revised                    1.6          3.6      2.0        9.0             8.1          7.3
corporate          Previously published            1.5          3.5      2.0        8.9             7.9          7.2
=========================================================================================================================

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Last Modified Date: September 05, 2019