THE PRIMARY SOURCE
Read the release
Historical release narrative reproduced from the official public-domain source. Statistical tables, standard technical appendices, administrative material and attendance rosters are omitted; formatting is adapted for reading. Figures retain the release's historical context and may have been revised. Consult the linked source for the complete document.
First Quarter 2000
The Bureau of Labor Statistics of the U.S. Department of Labor today reported preliminary productivity data--as measured by output per hour of all persons--for the first quarter of 2000. The seasonally adjusted annual rates of productivity change in the first quarter were:
1.8 percent in the business sector and 2.4 percent in the nonfarm business sector.
These productivity gains were smaller than the gains of the previous quarter (6.6 percent in the business sector and 6.9 percent in the nonfarm business sector, as revised). Output growth in the first quarter, 6.0 percent in both sectors, slowed somewhat from the rapid fourth-quarter pace, and hours of all persons in the first quarter grew more rapidly. First- quarter measures are summarized in table A and appear in detail in tables 1 through 5.
In manufacturing, productivity changes in the first quarter were:
6.9 percent in manufacturing, 9.9 percent in durable goods manufacturing, and 2.7 percent in nondurable goods manufacturing.
Productivity growth in manufacturing in the first quarter of 2000 reflected a strong increase in output, 6.2 percent, and a slight drop in the hours of all persons, -0.6 percent. Output and hours in manufacturing, which includes about 17 percent of U.S. business-sector employment, tend to vary more from quarter to quarter than data for the more aggregate business and nonfarm business sectors.
Historical measures of productivity and costs have been revised. See "Revised measures".
The data sources and methods used in the preparation of the manufacturing series differ from those used in preparing the business and nonfarm business series, and these measures are not directly comparable. Output measures for business and nonfarm business are based on measures of gross domestic product prepared by the Bureau of Economic Analysis of the U.S. Department of Commerce. Quarterly output measures for manufacturing reflect indexes of industrial production independently prepared by the Board of Governors of the Federal Reserve System. See Technical Notes for further information on data sources.
Business
Productivity in the business sector increased at a 1.8 percent annual rate from the fourth quarter of 1999 to the first quarter of 2000, as output increased 6.0 percent and hours of all persons engaged in the sector rose 4.2 percent (seasonally adjusted annual rates). Revised data for the fourth quarter of 1999 show that output per hour increased 6.6 percent, output increased 8.6 percent, and hours of all persons grew 1.9 percent (table 1).
Hourly compensation increased 3.7 percent during the first quarter of 2000. This measure includes wages and salaries, supplements, employer contributions to employee benefit plans, and taxes. Unit labor costs, which reflect changes in hourly compensation and productivity, increased at a 1.9 percent rate during the first quarter, after declining by 3.1 percent one quarter earlier.
Real hourly compensation, which takes into account changes in consumer prices, declined at a 0.2 percent annual rate in the first quarter, following 15 consecutive quarterly increases.
The implicit price deflator for the business sector, which reflects changes in both unit labor costs and unit nonlabor payments, rose at a 2.2 percent annual rate in the first quarter.
Nonfarm business
Productivity increased 2.4 percent in the nonfarm business sector in the first quarter, as output increased 6.0 percent and hours of all persons rose 3.6 percent. During the fourth quarter of 1999, productivity had increased 6.9 percent in this sector, reflecting gains of 8.5 percent in output and 1.5 percent in hours (table 2).
Hourly compensation increased at a 4.2 percent annual rate in the first quarter. When the rise in consumer prices was taken into account, real hourly compensation rose 0.3 percent in the first quarter of 2000; it had increased 0.9 percent in the fourth quarter of 1999.
Unit labor costs rose 1.8 percent in the first quarter, after falling 2.9 percent in the fourth quarter of 1999. The implicit price deflator for nonfarm business output rose 2.3 percent in the first quarter, compared with a 1.9 percent rise one quarter earlier.
Manufacturing
Productivity increased at a 6.9 percent seasonally adjusted annual rate in manufacturing in the first quarter of 2000, as output increased 6.2 percent and hours of all persons declined 0.6 percent. Productivity grew in both the durable and nondurable sectors of manufacturing, 9.9 and 2.7 percent, respectively. In durable goods manufacturing, output rose at a 9.6 percent annual rate in the first quarter, as hours fell 0.3 percent. Nondurable goods manufacturing output rose 1.5 percent in the first quarter, and hours declined by 1.1 percent.
Hourly compensation of all manufacturing workers rose 3.8 percent during the first quarter, but real hourly compensation fell off slightly, -0.1 percent. The hourly compensation of workers in durable goods manufacturing rose 3.1 percent, while that of employees in nondurable goods manufacturing grew 5.0 percent.
Unit labor costs in manufacturing fell 2.9 percent in the first quarter of 2000, as unit labor costs of durable goods producers declined 6.2 percent and those of nondurable goods producers rose at a 2.2 percent annual rate.
Fourth-quarter and annual measures for nonfinancial corporations
Fourth-quarter and annual 1999 measures of productivity and costs also were announced today for the nonfinancial corporate sector (tables B, C, and 6). Output per all-employee hour rose 5.1 percent from the third to the fourth quarter of 1999, as output increased 7.5 percent and employee hours rose 2.3 percent. In the third quarter, productivity had risen 4.0 percent, as output rose 6.6 percent and hours of all employees increased 2.4 percent (seasonally adjusted annual rates). The sector includes all corporations doing business in the United States, except those classified as depository institutions, nondepository institutions, security and commodity brokers, insurance carriers, regulated investment offices, small business investment offices, and real estate investment trusts.
Hourly compensation increased 3.5 percent in the fourth quarter, and real hourly compensation rose 0.7 percent. Unit labor costs fell 1.5 percent in the fourth quarter of 1999, the first decline since the third quarter of 1997, when they also fell 1.5 percent. Total unit costs declined 0.3 percent during the fourth quarter, after having increased 1.3 percent during the third quarter. In the fourth quarter, unit profits rose 10.7 percent. Unit profits fell 9.6 percent during the third quarter of 1999. The implicit price deflator for nonfinancial corporate output rose 0.9 percent during the fourth quarter of 1999.
Productivity grew 4.0 percent in 1999 for nonfinancial corporations, the same as the previous year (table C). Nonfinancial corporate output grew slower in 1999, 5.9 percent, than it had in 1998, when it grew 6.7 percent. Hours of employees in nonfinancial corporations rose 1.7 percent during 1999, compared with a 2.6 percent rise one year earlier.
Hourly compensation grew 4.9 percent in 1999, less than the 5.4 percent increase in 1998. Real hourly compensation increased 2.8 percent in 1999, compared with a 4.0 percent rise one year earlier.
Total unit costs rose 0.8 percent in 1999, reflecting an increase of 0.8 percent in unit labor costs and a 0.6 percent rise in unit nonlabor costs. Unit profits fell 1.3 percent in 1999; in 1998, they had fallen 4.0 percent.
REVISED MEASURES
Current and previous measures for the fourth quarter of 1999 for the business, nonfarm business, and manufacturing sectors are compared in table D. Some of the quarterly movements differ from those reported on March 7, based on information then available. Output and productivity were revised up, and unit labor costs correspondingly revised down, in all three sectors.
The revisions of productivity and cost measures to reflect the most recent revision of the national income and product accounts have been extended back to 1947 for the business and nonfarm business sectors and to 1958 for nonfinancial corporations. In addition, revised NIPA estimates beginning with 1959 incorporate several corrections. Based on these revisions, the long-term rate of growth in output per hour in the nonfarm business sector, 1947-1999, was 2.2 percent a year. Tables 1-6 show revised data in all sectors for 1998-1999. Appendix tables 1-3 show annual indexes of productivity and costs for the business, nonfarm business, and nonfinancial corporate sectors for all years since the inception of the series.
Productivity and cost measures were revised to reflect the results of the 1998 Hours at Work Survey, which are now available. This survey is used to adjust the number of hours for which private nonfarm employees are paid (as reported in the BLS Current Establishment Statistics program) to hours at the workplace. For 1998, these results show that hours of all persons in the nonfarm business sector rose at the same rate as had previously been reported. Hours of all persons in manufacturing fell 0.4 percent in 1998; previously, they had been reported as increasing 0.1 percent.
The Consumer Price Index Research Series has been updated. This affected indexes of real hourly compensation for all years.
Source: U.S. Bureau of Labor Statistics · Original release May 4, 2000.
Archived Nov 11, 2026. Source reuse policy. Formatting has been adapted for reading; the source’s conclusions remain attributed to its publisher.