March 28, 2008 (The Editor’s Desk is updated each business day.)

Multifactor productivity in nonfarm business, 2006

In the private nonfarm business sector, multifactor productivity—output per combined units of labor and capital inputs—rose 0.4 percent in 2006. This was the slowest rate of growth since 2001.

[Chart data—TXT]

Output increased 3.2 percent in 2006, and the combined inputs of capital and labor increased 2.8 percent.

Labor input grew 2.7 percent in 2006, compared to 1.8 percent in 2005. Capital services increased 2.8 percent in 2006, compared to 2.6 percent in the previous year.

Multifactor productivity is designed to measure the joint influences of economic growth on technological change, efficiency improvements, returns to scale, reallocation of resources, and other factors, allowing for the effects of capital and labor.

These data are from the Multifactor Productivity program. Productivity data are subject to revision. To learn more, see "Multifactor Productivity Trends, 2006" (PDF) (HTML), news release USDL 08-0410.