The following is the text of the U.S. productivity and costs report for the third quarter released by the Labor Department.
Nonfarm business sector labor productivity increased at a 1.9 percent annual rate during the third quarter of 2012, the U.S. Bureau of Labor Statistics reported today. The increase in productivity reflects increases of 3.2 percent in output and 1.3 percent in hours worked. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the third quarter of 2011 to the third quarter of 2012, productivity increased 1.5 percent as output and hours worked rose 3.3 percent and 1.8 percent, respectively.
Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked of all persons, including employees, proprietors, and unpaid family workers.
Unit labor costs in nonfarm businesses decreased 0.1 percent in the third quarter of 2012, while hourly compensation increased 1.8 percent. Unit labor costs rose 1.1 percent over the last four quarters.
BLS defines 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 productivity declined 0.4 percent in the third quarter of 2012, as output and hours worked decreased 0.6 percent and 0.2 percent, respectively. Productivity fell 0.7 percent in the durable goods sector and 0.1 percent in the nondurable goods sector. Over the last four quarters, manufacturing productivity increased 1.5 percent, as output increased 4.1 percent and hours worked rose 2.6 percent. Unit labor costs in manufacturing rose 1.5 percent in the third quarter of 2012 and decreased 0.8 percent from the same quarter a year ago.
The concepts, sources, and methods used for the manufacturing and nonfinancial corporate output series differ from those used in the business and nonfarm business output series; these output measures are not directly comparable. See Technical Notes for a more detailed explanation.
Revised and previous measures for the second quarter of 2012 are shown in tables B and C and cover the following major sectors: nonfarm business, business, manufacturing and nonfinancial corporations.
In the second quarter of 2012, nonfarm business productivity growth increased 1.9 percent, rather than 2.2 percent as reported September 5. The revised figure reflects a downward revision to output and a slight upward revision to hours worked. Unit labor costs increased 1.7 percent, as the downward revision to productivity was greater than the downward revision to hourly compensation. In the manufacturing sector, productivity growth was revised up slightly due to a small downward revision to hours. Unit labor costs increased 0.8 percent, the same as previously reported.
Revised second-quarter 2012 measures of productivity and costs were announced for the nonfinancial corporate sector. Productivity increased 1.6 percent rather than the 2.1 percent preliminary estimate.
The revised Productivity and Costs press release for third- quarter 2012 is scheduled to be released on Wednesday, December 5, 2012 at 8:30 a.m. (EST).