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Productivity and Costs, Third Quarter 2019, Preliminary



Transmission of material in this release is embargoed until                                   USDL 19-1908
8:30 a.m. (EST) Wednesday, November 6, 2019

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


                                        PRODUCTIVITY AND COSTS 
                                   Third Quarter 2019, Preliminary

Nonfarm business sector labor productivity decreased 0.3 percent in the third quarter of 2019, the 
U.S. Bureau of Labor Statistics reported today, as output increased 2.1 percent and hours worked 
increased 2.4 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) 
From the third quarter of 2018 to the third quarter of 2019, productivity increased 1.4 percent, reflecting 
a 2.3-percent increase in output and a 0.9-percent increase in hours worked. (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 3.6 percent in the third quarter of 2019, 
reflecting a 3.3-percent increase in compensation per hour and a 0.3-percent decline in productivity. 
Unit labor costs increased 3.1 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.

Hours worked data for the nonfarm business labor productivity measures include hours worked for all 
persons working in the sector--wage and salary workers, the self-employed, and unpaid family workers. 
Quarterly changes in hours worked by self-employed and unpaid family workers are more volatile than 
for wage and salary workers. In the third quarter of 2019, self-employed workers made an unusually 
large contribution to growth in hours worked by all persons. (See Technical Notes section for further 
information.)  

Manufacturing sector labor productivity declined 0.1 percent in the third quarter of 2019, as output 
increased 1.1 percent and hours worked increased 1.3 percent. Total manufacturing sector productivity 
also declined 0.1 percent over the last four quarters, as output decreased 0.5 percent and hours worked 
decreased 0.4 percent. (See tables A1 and 3.) Productivity increased 1.2 percent in the durable 
manufacturing sector in the third quarter of 2019, reflecting a 2.4-percent increase in output and a 1.2-
percent increase in hours worked. Productivity decreased 1.5 percent in the nondurable manufacturing 
sector as output declined 0.2 percent and hours worked increased 1.3 percent. (See tables A1, 4, and 5.) 
Unit labor costs in the manufacturing sector increased 3.6 percent in the third quarter of 2019, and 
increased 4.9 percent from the same quarter a year ago. 

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 measures        

Revised and previous measures for the second quarter of 2019 are shown in tables A2 and B1, covering 
the following major sectors: nonfarm business, business, manufacturing, and nonfinancial corporations.

In the second quarter of 2019, nonfarm business sector productivity increased 2.5 percent, slightly 
more than reported on September 5. Unit labor costs increased 2.4 percent during the second quarter, 
slightly less than previously reported. In the manufacturing sector, productivity was revised down 0.2 
percentage point to a decrease of 2.4 percent in the second quarter of 2019. Durable manufacturing 
productivity decreased 0.8 percent and nondurable manufacturing productivity fell 4.3 percent after 
revisions.  Unit labor costs in total manufacturing increased 6.9 percent in the second quarter of 2019 
rather than increasing 6.7 percent as reported September 5.

Second-quarter 2019 measures of productivity and costs were revised for the nonfinancial corporate 
sector. Productivity increased 2.5 percent rather than increasing 2.8 percent as previously reported. 
Unit labor costs increased 2.5 percent rather than the preliminary estimate of a 2.2-percent increase. 
(See table A2.)

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 third-quarter 2019 is scheduled to be released 
on Tuesday, December 10, 2019 at 8:30 a.m. (EST).





=========================================================================================================================
Table A1. Labor productivity growth and related measures - preliminary third-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          -0.3          2.1      2.4        3.3             1.4          3.6
                        A year ago                 1.4          2.3      0.9        4.5             2.7          3.1
                        
Business                Previous quarter          -0.3          2.2      2.5        3.3             1.5          3.6
                        A year ago                 1.5          2.3      0.8        4.6             2.8          3.0
                        
Manufacturing           Previous quarter          -0.1          1.1      1.3        3.5             1.7          3.6
                        A Year ago                -0.1         -0.5     -0.4        4.8             3.0          4.9
 Durable
 manufacturing          Previous quarter           1.2          2.4      1.2        3.1             1.3          1.9
                        A year ago                 0.6          0.6      0.0        4.8             3.0          4.2
 Nondurable
 manufacturing          Previous quarter          -1.5         -0.2      1.3        4.3             2.4          5.8
                        A year ago                -0.6         -1.7     -1.1        4.8             2.9          5.4
=========================================================================================================================


=========================================================================================================================
Table A2. 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
-------------------------------------------------------------------------------------------------------------------------       
Nonfinancial             Revised                   2.5          2.8      0.3        5.1             2.1          2.5
corporate          Previously published            2.8          3.1      0.3        5.1             2.1          2.2
=========================================================================================================================


=========================================================================================================================
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                    2.5          1.9     -0.5        5.0             2.0          2.4
                   Previously published            2.3          1.9     -0.4        4.9             1.9          2.6
                        
Business                Revised                    2.8          2.0     -0.7        5.2             2.3          2.4
                   Previously published            2.6          2.1     -0.5        5.2             2.2          2.5
                        
Manufacturing           Revised                   -2.4         -3.0     -0.7        4.4             1.4          6.9
                   Previously published           -2.2         -3.0     -0.8        4.3             1.3          6.7

 Durable                Revised                   -0.8         -2.0     -1.2        4.7             1.7          5.6
 manufacturing     Previously published           -0.6         -1.9     -1.4        4.6             1.6          5.2
                        
 Nondurable             Revised                   -4.3         -4.1      0.2        3.9             0.9          8.5
 manufacturing     Previously published           -4.4         -4.2      0.1        3.9             0.9          8.6
=========================================================================================================================

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Last Modified Date: November 06, 2019