Transmission of material in this release is embargoed until                                 USDL 21-0979
8:30 a.m. (ET) Thursday, June 3, 2021

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

                                          PRODUCTIVITY AND COSTS 
                                       First Quarter 2021, Revised 

(NOTE: This release was reissued on July 20, 2021, due to errors in the first quarter 2021 estimates 
of hours worked for the business, manufacturing, and nonfinancial corporate sectors. The error in hours
worked resulted in errors to related measures, including labor productivity. Estimates in this news release
will not be corrected. Corrected data are available at 
www.bls.gov/bls/errata/corrected-hours-worked-and-labor-productivity-for-labor-productivity-and-costs-2021-Q1.htm.) 

Nonfarm business sector labor productivity increased 5.4 percent in the first quarter of 2021, the U.S. 
Bureau of Labor Statistics reported today, as output increased 8.6 percent and hours worked increased 
3.0 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the 
first quarter of 2020 to the first quarter of 2021, nonfarm business sector labor productivity increased 4.1 
percent, reflecting a 1.1-percent increase in output and a 2.9-percent decline in hours worked. (See table 
A1.) 

Unit labor costs in the nonfarm business sector increased at an annual rate of 1.7 percent in the first 
quarter of 2021, the combined effect of a 7.2-percent increase in hourly compensation and a 5.4-percent 
increase in productivity. Unit labor costs increased 4.1 percent over the last four quarters, as hourly 
compensation increased 8.3 percent and productivity increased 4.1 percent. (See table A1.) 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 productivity tend to reduce them.

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. The first 
quarter of 2021 is the third consecutive quarter with increases in both output and hours worked, 
following historic declines in those measures in the second quarter of 2020. With the 3.0-percent 
increase in the first quarter of 2021, the hours worked index is 4.3 percent lower than it was in the fourth 
quarter of 2019, the last quarter not affected by the COVID-19 pandemic. Output, however, with the 
8.6-percent increase in the first quarter of 2021, is now only 0.5 percent below the level seen in the 
fourth quarter of 2019. (See table 2.)

Manufacturing sector labor productivity decreased 1.7 percent in the first quarter of 2021, as output 
increased 1.4 percent and hours worked increased 3.1 percent. Manufacturing productivity increased 1.8 
percent from the same quarter a year ago. (See tables A1 and 3.)

Unit labor costs in the total manufacturing sector increased 10.7 percent in the first quarter of 2021, 
reflecting an 8.9-percent increase in hourly compensation and a 1.7-percent decrease in productivity. 
Manufacturing unit labor costs increased 5.1 percent from the same quarter a year ago. (See tables A1 
and 3.)

Following strong growth in the fourth quarter of 2020, manufacturing output and hours worked saw 
more modest growth rates in the first quarter of 2021. These measures have not yet fully recovered from 
the historic declines of the second quarter of 2020; output and hours remain 2.3 percent and 4.4 percent 
below their fourth-quarter 2019 levels, respectively. (See table 3.)

Durable goods manufacturing productivity increased 1.1 percent in the first quarter of 2021, reflecting a 
5.7-percent increase in output and a 4.6-percent increase in hours worked. Nondurable goods 
manufacturing productivity decreased 3.7 percent in the first quarter of 2021, as output decreased 3.0 
percent and hours worked increased 0.7 percent. (See tables A1, 4, and 5.)

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 first-quarter 2021 measures were announced today for the nonfinancial corporate sector. 
Productivity increased 5.8 percent in the first quarter of 2021 as output increased 8.8 percent and hours 
worked increased 2.8 percent. Productivity increased 6.5 percent over the last four quarters, which is the 
largest four-quarter increase since a 7.9-percent increase in the first quarter of 2010. Unit profits of 
nonfinancial corporations decreased at a 4.7 percent annual rate in the first quarter of 2021 and increased 
18.5 percent over the last four quarters, which is the largest four-quarter increase since an 18.8-percent 
increase in the first quarter of 2012. (See table 6.) 

Revised measures        

Measures released today are based on more recent source data than were available for the preliminary 
report. Regular updates of source data from the BLS, the Bureau of Economic Analysis (BEA), and the 
Board of Governors of the Federal Reserve System are reflected in data for the fourth quarter of 2020 
and the first quarter of 2021. Measures of output for the manufacturing sectors incorporate revised 
annual benchmark data released May 20 by BLS. As a result, quarterly indexes and percent changes for 
output and related measures were subject to revision from first-quarter 2012 to fourth-quarter 2019.

Table B1 presents previous and revised productivity and related measures for the business, nonfarm 
business, and manufacturing sectors for the first quarter of 2021.

In the first quarter of 2021, nonfarm business sector productivity increased 5.4 percent, the same as 
previously reported. Output was revised up 0.2 percentage point and hours worked was revised up 0.1 
percentage point. Unit labor costs increased 1.7 percent rather than decreasing 0.3 percent as previously 
reported, reflecting a 2.1-percentage point upward revision to hourly compensation. In the 
manufacturing sector, productivity was revised down from a 0.1-percent increase to a 1.7-percent 
decrease, reflecting a 1.0-percentage point downward revision to output and a 0.8-percentage point 
upward revision to hours worked. Unit labor costs increased 10.7 percent rather than the preliminary 
estimate of 4.6 percent.  

Table B2 shows previous and revised productivity and related measures for the business, nonfarm 
business, manufacturing, and nonfinancial corporate sectors for the fourth quarter of 2020. 

In the fourth quarter of 2020, labor productivity in the nonfarm business sector decreased at the same 
3.8-percent rate reported May 6. Hourly compensation was revised up from the previously reported 
increase of 1.6 percent to a 9.7-percent increase. As a result, unit labor costs increased 14.0 percent in 
the fourth quarter of 2020, rather than increasing 5.6 percent. Total manufacturing sector productivity 
was revised down by 0.1 percentage point to a 4.4 percent increase. Hourly compensation was revised 
up 13.9 percentage points to a 9.8-percent increase; this led to an upward revision to unit labor costs, 
which increased 5.1 percent rather than decreasing 8.2 percent.

In the nonfinancial corporate sector, productivity rose 16.7 percent in the fourth quarter of 2020 rather 
than increasing 11.6 percent as previously reported, due solely to an upward revision to output. Annual 
average productivity in the nonfinancial corporate sector increased 2.1 percent in 2020, rather than the 
preliminary estimate of 1.8 percent.

Complete quarterly and annual 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 second-quarter 2021 is scheduled to be 
released on Tuesday, August 10, 2021 at 8:30 a.m. (ET).




=========================================================================================================================
Table A1. Labor productivity growth and related measures – revised first-quarter 2021
(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            5.4          8.6      3.0        7.2            3.3           1.7
                        A year ago                  4.1          1.1     -2.9        8.3            6.3           4.1
                        
Business                Previous quarter            5.2          8.3      2.9        7.3            3.4           1.9
                        A year ago                  4.0          1.1     -2.8        8.3            6.3           4.1
                        
Manufacturing           Previous quarter           -1.7          1.4      3.1        8.9            5.0          10.7
                        A Year ago                  1.8         -0.9     -2.6        7.0            5.0           5.1
 
 Durable                Previous quarter            1.1          5.7      4.6       11.7            7.6          10.4
 manufacturing          A year ago                  4.0          0.4     -3.5        7.1            5.1           3.0
              
 Nondurable             Previous quarter           -3.7         -3.0      0.7        3.6           -0.1           7.6
 manufacturing          A year ago                 -1.0         -2.2     -1.2        6.9            4.9           8.0
=========================================================================================================================

=========================================================================================================================
Table A2. Labor productivity growth and related measures – preliminary first-quarter 2021
(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                5.8         8.8      2.8        6.7            2.8           0.8
corporate            A year ago                      6.5         3.3     -3.0        9.1            7.1           2.4
=========================================================================================================================

=========================================================================================================================
Table B1. Labor productivity growth and related measures – revised and previously published first-quarter 2021
(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                      5.4         8.6      3.0        7.2            3.3           1.7
                   Previously published              5.4         8.4      2.9        5.1            1.3          -0.3
                        
Business                Revised                      5.2         8.3      2.9        7.3            3.4           1.9
                   Previously published              5.4         8.3      2.8        5.1            1.3          -0.2
                        
Manufacturing           Revised                     -1.7         1.4      3.1        8.9            5.0          10.7
                   Previously published              0.1         2.4      2.3        4.6            0.9           4.6

 Durable                Revised                      1.1         5.7      4.6       11.7            7.6          10.4
 manufacturing     Previously published              0.7         4.6      3.9        6.2            2.4           5.5
                        
 Nondurable             Revised                     -3.7        -3.0      0.7        3.6           -0.1           7.6
 manufacturing     Previously published              0.3         0.1     -0.2        1.6           -2.1           1.2
=========================================================================================================================

=========================================================================================================================
Table B2. Labor productivity growth and related measures – revised and previously published fourth-quarter 2020
(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                     -3.8         5.8     10.0        9.7            7.1          14.0
                   Previously published             -3.8         5.8     10.0        1.6           -0.8           5.6
                        
Business                Revised                     -4.5         5.8     10.8        8.8            6.2          13.9
                   Previously published             -4.5         5.8     10.8        0.8           -1.6           5.6
                                                                          
Manufacturing           Revised                      4.4        12.4      7.6        9.8            7.2           5.1
                   Previously published              4.5        12.4      7.6       -4.1           -6.4          -8.2

 Durable                Revised                      5.6        11.9      6.0       11.3            8.7           5.4
 manufacturing     Previously published              5.5        11.8      6.0       -6.0           -8.2         -10.9
                        
 Nondurable             Revised                      2.3        12.9     10.3        7.3            4.8           4.9
 manufacturing     Previously published              2.4        13.0     10.3       -0.4           -2.8          -2.8

Nonfinancial            Revised                     16.7        28.8     10.3        7.8            5.3          -7.6
corporate          Previously published             11.6        23.1     10.3        0.3           -2.1         -10.1 
=========================================================================================================================