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Multifactor productivity rose 0.9 percent in 2017

April 06, 2018

Private nonfarm business sector multifactor productivity increased 0.9 percent in 2017. This follows a decrease of 0.6 percent in 2016. The 2017 increase reflected a 2.9-percent increase in output and a 2.0-percent increase in the combined inputs of capital and labor. Capital services grew by 2.2 percent. Labor input—the combined effect of hours worked and labor composition—grew by 1.9 percent.

Annual percent change in multifactor productivity and related measures, 1988–2017
Year Multifactor productivity Real value-added output Combined inputs Capital services Labor input

1988

1.1% 4.6% 3.4% 3.9% 3.2%

1989

0.0 3.7 3.7 4.2 3.4

1990

0.3 1.5 1.2 3.5 0.1

1991

-0.7 -0.5 0.2 3.2 -1.3

1992

3.0 4.0 1.0 2.7 0.2

1993

-0.5 3.2 3.7 3.5 3.8

1994

0.5 4.6 4.2 3.8 4.3

1995

0.0 3.6 3.5 4.5 3.0

1996

1.1 4.6 3.5 4.9 2.7

1997

0.9 5.2 4.3 5.6 3.6

1998

1.5 5.3 3.8 6.3 2.6

1999

1.8 5.6 3.8 6.7 2.4

2000

1.3 4.4 3.1 6.5 1.4

2001

0.5 0.9 0.4 4.8 -1.6

2002

2.0 1.8 -0.2 3.4 -1.9

2003

2.1 3.2 1.0 2.8 0.1

2004

2.6 4.5 1.9 2.6 1.5

2005

1.5 3.8 2.2 3.2 1.7

2006

0.3 3.3 2.9 3.4 2.6

2007

0.5 2.4 1.9 3.0 1.2

2008

-1.3 -1.3 0.0 2.5 -1.4

2009

-0.4 -4.1 -3.7 0.7 -6.2

2010

3.3 3.2 -0.1 0.0 -0.1

2011

0.2 2.2 2.0 1.2 2.6

2012

0.9 3.1 2.2 1.3 2.7

2013

0.1 2.1 2.0 1.9 2.0

2014

1.0 3.3 2.4 2.3 2.4

2015

0.9 3.5 2.5 2.6 2.4

2016

-0.6 1.5 2.1 2.5 1.8

2017

0.9 2.9 2.0 2.2 1.9

Multifactor productivity in the private nonfarm business sector grew at an average annual rate of 0.8 percent from 1987 to 2017. For the 2007–17 period, it grew 0.5 percent on average, as combined inputs increased at an average annual rate of 1.1 percent and output increased at a 1.6-percent average annual rate. The increase in combined inputs reflected a 1.7-percent average annual increase in capital services and a 0.8-percent average annual increase in labor input.

These data are from the Multifactor Productivity program. To learn more, see "Multifactor Productivity Trends — 2017" (HTML) (PDF). Multifactor productivity is calculated by dividing an index of real output by an index of combined units of labor input and capital services. Unlike BLS quarterly labor productivity (output per hour worked) measures, multifactor productivity measures include the influences of capital services and shifts in the composition of the workforce.

SUGGESTED CITATION

Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Multifactor productivity rose 0.9 percent in 2017 on the Internet at https://www.bls.gov/opub/ted/2018/multifactor-productivity-rose-0-point-9-percent-in-2017.htm (visited November 12, 2019).

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