Productivity and Costs, First Quarter 2019, Revised

Transmission of material in this release is embargoed until			              USDL 19-0903
8:30 a.m. (EDT) Thursday, June 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 
                                     First Quarter 2019, Revised
                                     
Nonfarm business sector labor productivity increased 3.4 percent in the first quarter of 2019, the U.S. 
Bureau of Labor Statistics reported today, as output increased 3.9 percent and hours worked increased 
0.5 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the 
first quarter of 2018 to the first quarter of 2019, productivity increased 2.4 percent, reflecting a 3.9-
percent increase in output and a 1.5-percent increase in hours worked. (See table A1.) The four-quarter 
increase in productivity is the largest since a 2.7-percent gain in the third quarter of 2010. 

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 decreased 1.6 percent in the first quarter of 2019, and 
decreased 0.8 percent over the last four quarters--the lowest four-quarter rate since a 1.7-percent decline 
in the fourth quarter of 2013. (See and 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 increased 0.4 percent in the first quarter of 2019, as output 
decreased 2.0 percent and hours worked decreased 2.4 percent. Productivity declined 0.6 percent in the 
durable manufacturing sector, reflecting a 2.8-percent decrease in output and a 2.2-percent decrease in 
hours worked. Productivity increased 1.6 percent in the nondurable manufacturing sector as output fell 
1.1 percent but hours worked fell 2.6 percent. Over the last four quarters, total manufacturing sector 
productivity increased 0.8 percent, as output increased 1.6 percent and hours worked increased 0.7 
percent. Unit labor costs in the manufacturing sector increased 2.0 percent in the first quarter of 2019 
and saw no change 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 first-quarter 2019 measures were announced today for the nonfinancial corporate sector. 
Productivity decreased 0.4 percent in the first quarter of 2019 and increased 1.3 percent over the last 
four quarters. Unit profits of nonfinancial corporations fell at a 17.9 percent annual rate in the first 
quarter of 2019 and increased 3.7 percent over the last four quarters. (See table 6.) 

Revised measures

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 business, nonfarm business, and manufacturing sectors for the first quarter of 2019. 

In the first quarter of 2019, nonfarm business productivity rose 3.4 percent, rather than 3.6 percent as 
reported May 2, due solely to a 0.2-percentage point downward revision to output. Unit labor costs 
were revised down and decreased 1.6 percent, as hourly compensation was revised down by more than 
productivity. In the manufacturing sector, productivity was revised down from an increase of 1.7 
percent to an increase of 0.4 percent, due primarily to a 1.0-percentage point downward revision to 
output; hours worked were revised up 0.2 percentage points. Unit labor costs increased 2.0 percent rather 
than the preliminary estimate of 0.8 percent, reflecting the downward revision to productivity; hourly 
compensation increased at the same 2.4 percent rate reported previously.

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 2018. 

In the fourth quarter of 2018, labor productivity in the nonfarm business sector increased at the same 
1.3-percent rate reported May 2. Hourly compensation was revised down from the previously reported 
increase of 3.9 percent to a 0.9-percent increase. As a result, unit labor costs decreased 0.4 percent in the 
fourth quarter of 2018, rather than increasing 2.5 percent. Total manufacturing sector productivity 
increased 1.0 percent in the fourth quarter of 2018, a smaller increase than previously reported. Hourly 
compensation was revised down 0.9 percentage point to a 3.4-percent increase; this led to a downward 
revision to unit labor costs, which rose 2.4 percent rather than increasing 3.2 percent.  

In the nonfinancial corporate sector, productivity rose 1.4 percent in the fourth quarter of 2018 rather 
than increasing 3.2 percent as previously reported, due solely to a downward revision to output. Annual 
average productivity in the nonfinancial corporate sector increased 2.0 percent in 2018, rather than the 
preliminary estimate of 2.1 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 2019 is scheduled to be 
released on Thursday, August 15, 2019 at 8:30 a.m. (EDT).


=========================================================================================================================
Table A1. Labor productivity growth and related measures  revised first-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         3.4            3.9       0.5           1.8          0.9          -1.6
                         A year ago               2.4            3.9       1.5           1.5         -0.1          -0.8
Business                 Previous quarter         3.5            3.9       0.4           1.9          1.0          -1.5
                         A year ago               2.4            3.9       1.4           1.6         -0.1          -0.8
Manufacturing            Previous quarter         0.4           -2.0      -2.4           2.4          1.5           2.0
                         A year ago               0.8            1.6       0.7           0.9         -0.8           0.0
Durable manufacturing    Previous quarter        -0.6           -2.8      -2.2           2.1          1.1           2.7      
                         A year ago               1.0            2.4       1.5           0.4         -1.3          -0.6
Nondurable manufacturing Previous quarter         1.6           -1.1      -2.6           3.1          2.2           1.5      
                         A year ago               1.1            0.6      -0.5           1.6          0.0           0.5
=========================================================================================================================


=========================================================================================================================
Table A2. Labor productivity growth and related measures  preliminary first-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 corporate Previous quarter           -0.4           1.6       2.0           1.6          0.7          2.0
                       A year ago                  1.3           3.2       1.9           1.4         -0.3          0.1
=========================================================================================================================


=========================================================================================================================
Table B1. 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                      3.4        3.9       0.5           1.8         0.9         -1.6
                         Previously published         3.6        4.1       0.5           2.6         1.7         -0.9
Business                 Revised                      3.5        3.9       0.4           1.9         1.0         -1.5
                         Previously published         3.7        4.1       0.4           2.8         1.9         -0.8
Manufacturing            Revised                      0.4       -2.0      -2.4           2.4         1.5          2.0
                         Previously published         1.7       -1.0      -2.6           2.4         1.5          0.8
Durable manufacturing    Revised                     -0.6       -2.8      -2.2           2.1         1.1          2.7
                         Previously published         1.4       -0.9      -2.3           2.6         1.7          1.1
Nondurable manufacturing Revised                      1.6       -1.1      -2.6           3.1         2.2          1.5
                         Previously published         2.1       -1.0      -3.0           2.1         1.2          0.0
=========================================================================================================================



=========================================================================================================================
Table B2. Labor productivity growth and related measures  revised and previously published fourth-quarter 2018
(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                      1.3       2.6       1.3        0.9         -0.6            -0.4
                         Previously published         1.3       2.6       1.3        3.9          2.3             2.5
Business                 Revised                      1.2       2.6       1.4        0.7         -0.8            -0.5
                         Previously published         1.2       2.6       1.4        3.6          2.1             2.4
Manufacturing            Revised                      1.0       1.6       0.6        3.4          1.8             2.4
                         Previously published         1.1       1.7       0.6        4.3          2.7             3.2
Durable manufacturing    Revised                      2.0       4.7       2.6        3.0          1.4             0.9
                         Previously published         2.4       5.1       2.6        4.1          2.6             1.7
Nondurable manufacturing Revised                      1.0      -1.6      -2.6        3.7          2.1             2.7
                         Previously published         0.9      -1.7      -2.6        4.0          2.5             3.1
Nonfinancial corporate   Revised                      1.4       2.6       1.2        0.3         -1.2            -1.0
                         Previously published         3.2       4.5       1.2        3.5          2.0             0.3
=========================================================================================================================

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Last Modified Date: June 06, 2019