The 2020 Mid-Year Economic Update_long

Manufacturing Productivity Down 1.1% in 1Q

Productivity decreased 2.3 percent in durable goods, unchanged in nondurable goods.

Manufacturing sector productivity decreased 1.1 percent in the first quarter as output decreased 1.2 percent and hours worked edged down 0.1 percent, according to the U.S. Bureau of Labor Statistics. Productivity decreased 2.3 percent in the durable manufacturing sector and was unchanged in the nondurable manufacturing sector.

Over the last four quarters, manufacturing productivity increased 1.4 percent, as output increased 3.8 percent and hours increased 2.3 percent. Unit labor costs in manufacturing increased 2.7 percent in the first quarter of 2015 and decreased 0.7 percent from the same quarter a year ago. Nonfinancial corporate sector productivity increased 2.5 percent in the fourth quarter and 1.5 percent over the last four quarters, according to preliminary fourth quarter and annual data.

Nonfarm business sector labor productivity decreased at a 1.9 percent annual rate during the first quarter as output declined 0.2 percent and hours worked increased 1.7 percent.

From the same quarter last year, productivity increased 0.6 percent, reflecting increases in output and hours worked of 3.5 percent and 2.9 percent, respectively.

Unit labor costs in nonfarm businesses increased 5 percent in the first quarter, reflecting a 3.1 percent increase in hourly compensation and a 1.9 percent decline in productivity. Unit labor costs increased 1.1 percent over the last four quarters.

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