Important Information Regarding Industry Labor Productivity and Costs Data Tables

Industry Labor Productivity and Costs Data

The data presented in the Industry Labor Productivity and Costs Data Tables are from a database of industry labor productivity indexes and related data produced by the Bureau of Labor Statistics, U.S. Department of Labor. The labor productivity indexes are computed by dividing an index of output by an index of hours.

Industry labor productivity indexes show changes over time in the relationship between the output of an industry and the labor hours expended on that output. Measures have been developed for all manufacturing and retail trade North American Industry Classification System (NAICS) industries as well as selected mining, transportation, communications and services industries. Measures for all industries in the database start in 1987. All indexes are updated annually and continue through the most recent year for which data are available.

A Tornqvist index of output is developed for each industry by computing a weighted average of the growth rates of the various industry products between two periods, with weights based on the products' shares in industry value of production. The weight for each product equals its average value share in the two periods. Therefore, the weights are allowed to change through time rather than being fixed. For a more complete discussion of the Tornqvist methodology see "Industry Productivity Measures," Chapter 11 of the BLS Handbook of Methods, BLS Bulletin 2490, April 1997, pp. 103-109.

An index of hours is computed for an industry by dividing a measure of total labor hours in the industry in each year by the hours for the base year. Total hours are calculated for each industry by multiplying its annual employment by its average weekly hours by 52 weeks.

Measures of output per hour (labor productivity) are useful for studying changes in labor utilization, projecting future employment requirements, analyzing trends in labor costs, comparing productivity progress among countries, examining the effects of technological improvements on employment and unemployment, and analyzing related economic and industrial activities. Although the labor productivity measures relate output to one input--labor time--they do not measure the specific contribution of labor, capital, or any other factor of production. Rather, they reflect the joint effect of a number of interrelated influences such as changes in technology, capital investment per worker, utilization of capacity, layout and flow of material, skill and effort of the work force, managerial skill, and labor-management relations.

Measures of unit labor costs and total labor compensation are also available. Industry unit labor cost indexes are calculated as the ratio of labor compensation to real output. The labor compensation measures are based on data of gross payroll plus supplemental benefits.

Industry indexes are available for output per hour (labor productivity), output per employee, output, hours, unit labor costs and total compensation.  These indexes are presented with a base year of 1997=100. The number of employees, annual hours, net value of production and the implicit price deflator for output are available upon request from the Office of Productivity and Technology (202-691-5618) or by e-mail (dipsweb@bls.gov).

Last Modified Date: September 10, 2004

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