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Unit labor costs for nonfarm business increase 1.9 percent during 2016

February 10, 2017

During 2016, unit labor costs in the nonfarm business sector increased 1.9 percent, as hourly compensation increased 2.9 percent and labor productivity (output per hour) increased 1.0 percent. Since the end of 2006, unit labor costs for nonfarm business increased 12.7 percent, as hourly compensation grew 27.3 percent and labor productivity increased 13.0 percent.

Unit labor costs for nonfarm business and manufacturing, fourth quarter 2006 to fourth quarter 2016 (Q4 2006 = 100)
Quarter Nonfarm business Manufacturing
Unit labor costs Hourly compensation Labor productivity Unit labor costs Hourly compensation Labor productivity

Q4 2006

100.000 100.000 100.000 100.000 100.000 100.000

Q1 2007

102.360 102.469 100.107 100.822 101.992 101.160

Q2 2007

101.669 102.432 100.751 99.145 101.918 102.797

Q3 2007

100.846 102.761 101.899 97.324 102.064 104.871

Q4 2007

101.501 103.875 102.340 95.452 103.199 108.117

Q1 2008

103.530 104.880 101.304 93.465 103.428 110.659

Q2 2008

102.595 104.946 102.291 94.370 103.895 110.093

Q3 2008

103.214 105.844 102.547 97.415 105.272 108.064

Q4 2008

104.993 106.981 101.895 103.580 107.774 104.049

Q1 2009

101.602 104.317 102.673 106.530 106.067 99.566

Q2 2009

102.130 106.865 104.636 109.899 108.697 98.906

Q3 2009

101.357 107.599 106.159 107.711 109.123 101.311

Q4 2009

100.769 108.234 107.408 106.543 110.622 103.828

Q1 2010

99.545 107.476 107.965 100.843 108.099 107.195

Q2 2010

100.337 108.729 108.363 98.910 110.019 111.231

Q3 2010

100.282 109.221 108.913 97.449 110.177 113.062

Q4 2010

100.322 109.697 109.345 96.890 111.539 115.119

Q1 2011

102.977 111.648 108.419 96.331 112.461 116.745

Q2 2011

102.064 111.011 108.767 95.644 111.857 116.952

Q3 2011

102.890 111.689 108.552 94.494 112.282 118.825

Q4 2011

100.848 110.299 109.372 93.271 110.903 118.904

Q1 2012

103.026 112.863 109.549 94.648 113.477 119.893

Q2 2012

102.998 113.482 110.179 94.852 113.775 119.949

Q3 2012

103.269 113.538 109.944 94.781 113.414 119.659

Q4 2012

106.512 116.523 109.399 95.381 114.625 120.177

Q1 2013

103.824 113.937 109.740 94.153 113.291 120.327

Q2 2013

105.463 115.534 109.550 94.574 114.273 120.829

Q3 2013

105.322 115.880 110.025 95.414 114.518 120.022

Q4 2013

104.813 116.485 111.136 95.552 114.181 119.496

Q1 2014

107.392 118.247 110.106 97.745 117.053 119.755

Q2 2014

106.396 117.743 110.665 96.659 116.287 120.307

Q3 2014

106.330 118.874 111.797 97.147 117.233 120.675

Q4 2014

107.692 119.920 111.354 98.307 118.314 120.352

Q1 2015

107.888 120.452 111.646 98.256 117.754 119.844

Q2 2015

108.833 121.868 111.978 99.187 119.326 120.303

Q3 2015

109.062 122.730 112.531 99.361 120.614 121.390

Q4 2015

110.575 123.677 111.848 101.636 123.025 121.045

Q1 2016

110.482 123.382 111.677 100.061 121.529 121.455

Q2 2016

112.162 125.210 111.634 102.135 123.897 121.307

Q3 2016

112.212 126.359 112.608 102.977 124.931 121.319

Q4 2016 (p)

112.683 127.297 112.970 103.821 126.182 121.538
Footnotes:

(p)Preliminary.

Manufacturing sector unit labor costs increased 2.2 percent during 2016, with hourly compensation rising 2.6 percent and labor productivity rising 0.4 percent. Over the last decade, unit labor costs for manufacturing increased 3.8 percent. Over this period, a 21.5-percent increase in output per hour has largely offset a 26.2-percent increase in hourly compensation costs.

These data are from the Labor Productivity and Costs program. All percent changes shown are subject to revision. To learn more, see "Productivity and Costs — Fourth Quarter and Annual Averages 2016, Preliminary" (HTML) (PDF). Also see Charts related to the latest "Productivity and Costs" news release. Unit labor costs are calculated as the ratio of hourly compensation to labor productivity. Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked for all persons, including employees, proprietors, and unpaid family workers.

SUGGESTED CITATION

Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Unit labor costs for nonfarm business increase 1.9 percent during 2016 on the Internet at https://www.bls.gov/opub/ted/2017/unit-labor-costs-for-nonfarm-business-increase-1-point-9-percent-during-2016.htm (visited October 28, 2020).

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