Productivity by State News Release

For release 10:00 a.m. (ET) Thursday, May 25, 2023                                               USDL-23-1090

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


				PRODUCTIVITY BY STATE - 2022
 
Labor productivity in the private nonfarm sector declined in 37 states and the District of Columbia in 
2022, the U.S. Bureau of Labor Statistics reported today. Output increased in 43 states and the District. 
Hours worked increased in 48 states and the District, and declined in Minnesota and Nebraska. Idaho 
experienced the highest growth in labor productivity, an increase of 4.0 percent. 

Labor productivity, output, and hours worked for select states, percent change, 2022
	* Idaho was the only state to see productivity rise more than 2.0 percent (+4.0 percent). 
	* Output growth exceeded 5.0 percent in Idaho (+5.4 percent) and Tennessee (+5.1 percent).
	* Nevada and Hawaii saw the highest growth in hours worked (+10.7 percent and +7.5 percent, 
	respectively).
	* All seven states experiencing declines in output also recorded increases in hours worked: Alaska, 
	Louisiana, Maryland, Mississippi, New Hampshire, North Dakota, and Oklahoma.
	* Eleven states saw labor productivity increase due to a rise in output that outpaced growth in hours 
	worked: Colorado, Connecticut, Florida, Idaho, Illinois, Iowa, Kentucky, South Dakota, 
	Tennessee, Vermont, and Wisconsin. 
	* Labor productivity growth in Minnesota (+1.7 percent) and Nebraska (+1.6 percent) was the result 
	of increasing output and declining hours worked. 

Contributions to national labor productivity, 2022

Each state's annual contribution to national productivity growth is calculated by multiplying the state's 
productivity growth rate by its average share of total current dollar national output. The economic size of 
each state influences its contribution to national and regional estimates. With a 4.5-percent decline in 
labor productivity in 2022, California had the largest influence on the national change, contributing to 
over one-third of the 1.9-percent decline at the national level. 

2019-22 trends
While increases in output and hours worked were widespread in 2022, not all areas have fully recovered 
to levels seen before the COVID-19 pandemic. Note that percent changes for periods of more than 1 year 
are annual percent changes. 
	* Three areas saw annualized labor productivity growth of more than 3.0 percent - the District of 
	Columbia (+4.8 percent), Washington (+3.3 percent), and Iowa (+3.1 percent).
	* Labor productivity has declined from 2019 to 2022 in nine states:
		o Alaska (-1.6 percent)
		o Hawaii (-0.8 percent)
		o Louisiana (-2.1 percent)
		o Nevada (-0.4 percent)
		o North Dakota (-0.4 percent)
		o Oklahoma (-0.8 percent)
		o Texas (-0.6 percent)
		o West Virginia (-0.2 percent)
		o Wyoming (-0.4 percent)
	* Annualized rates of hours worked declined for 24 states and the District of Columbia from 2019 to 
	2022. 
	* The District of Columbia saw the largest decrease in hours worked (-2.6 percent).
	* Idaho saw the highest growth in both output and hours worked (+5.8 percent and +3.0 percent, 
	respectively). 
	* Eight states have not yet returned to 2019 levels of output. 

Long term trends
	* From 2007 to 2022, labor productivity rose in 47 states and the District of Columbia. 
	* North Dakota experienced the highest rate of labor productivity growth of 2.7 percent per year. 
	* Three states had productivity declines from 2007 to 2022: Alaska (-0.3 percent), Louisiana (-0.6 
	percent), and Wyoming (-0.5 percent).
	* Output grew in 46 states and the District of Columbia while hours worked grew in 34 states and 
	the District of Columbia. 

Contributions to national labor productivity, 2007-22
 
California, New York, and Texas, which have the largest economies, contributed the most to national 
productivity growth, nearly 40 percent of the 1.3-percent increase. 

Additional Information

Measures of hours worked and employment for all states reflect a change in methods and are revised 
historically. Data from the BLS Current Population Survey (CPS) have been used to adjust measures of 
Current Employment Statistics (CES) all-employee hours paid to account for unpaid hours worked, also 
known as off-the-clock hours. These adjustments are also made for national measures of hours worked. 
For more information on the new hours worked methodology, see 
www.bls.gov/opub/mlr/2022/article/improving-estimates-of-hours-worked-for-us-
productivity-measurement.htm. In addition, a scaling adjustment has been applied to state hours worked 
and employment measures to improve consistency between state and national labor measures.

Measures of output for all states reflect a change in methods and are revised historically. Estimates of 
owner-occupied housing, which are subtracted from output, are now based on imputed rent data provided 
by the Bureau of Economic Analysis (BEA). 

Output and compensation measures for 2021 and earlier years reflect revisions to GDP by state and 
industry data published by the BEA. Hours and employment data through 2021 have been revised to 
incorporate the BLS 2022 CES benchmark. 

Access the following productivity data at www.bls.gov/productivity/tables/labor-productivity-by-state-
and-region.xlsx
	* Detailed data series: indexes of productivity and related measures; rates of change; and levels of state 
	employment, hours worked, value-added output, and labor compensation 
	* Additional years and long-term data

Subscribe to productivity news releases on the BLS website at 
https://public.govdelivery.com/accounts/USDOLBLS/subscriber/new.

If you are deaf, hard of hearing, or have a speech disability, please dial 7-1-1 to access 
telecommunications relay services. 
	

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 a state to hours worked of all persons in that state, 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. 

Output: Measures of real value-added output for the private nonfarm sector are created using 
GDP by state and industry data published by the Bureau of Economic Analysis (BEA). BEA does 
not produce a private nonfarm sector measure of real output by state. To create the necessary 
output series, several industry components are subtracted - the farm sector, private households, 
and owner-occupied housing - from GDP by state using a Fisher ideal index formula. 

Labor Hours: Hours are the number of hours worked by all employed persons, including wage 
and salary workers, self-employed persons, and unpaid family workers. Hours for wage and salary 
workers are primarily from BLS Current Employment Statistics (CES) and hours for self-
employed and unpaid family workers are from the BLS Current Population Survey (CPS). The 
hours are adjusted from an hours paid basis to an hours worked basis using data from the BLS 
National Compensation Survey (NCS).

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.

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. Labor compensation 
measures are constructed using BEA nonfarm compensation less private household 
compensation. Compensation for self-employed and unpaid family workers are imputed by 
assuming that hourly compensation for these workers is the same as the average wage and salary 
worker in each state. 

Contributions to Labor Productivity: Each state's contribution to national productivity growth 
is calculated by multiplying the state's productivity growth rate by its average share of total 
current dollar national output. Adding up these contributions will approximate, but may not 
exactly equal, growth rates of national productivity. Contributions measures used in this release 
capture the effects of within-state productivity changes but do not include the effects of shifting 
shares of output and labor among states.

Annual Percent Change: The annual percent change is the compound annual growth rate in an 
index series over a period of more than one year. The change of an index series varies from year 
to year. However, the annual percent change is the constant rate that can be applied to each year 
in a period, from the start to the end, that would give the same total result. It is calculated as 
(Ending Value/Starting Value)^(1/Number of Years)-1.