March 24, 2006 (The Editor’s Desk is updated each business day.)

Multifactor productivity, 1995-2004

In the private business sector, multifactor productivity—output per combined units of labor and capital inputs—grew at an annual rate of 2.9 percent in 2004.

[Chart data—TXT]

In the previous year, private business sector multifactor productivity rose 2.8 percent. Multifactor productivity in the private business sector in 2003 and 2004 shows the fastest rate of growth in the current time series, which goes back to 1987.

In private business, the change in multifactor productivity reflects the difference between the change in real gross domestic product for the sector and the change in labor and capital inputs engaged in the production of this output. Multifactor productivity differs from the labor productivity (output per hour worked) measures that are published quarterly by BLS since it includes information on capital services and other data that are not available on a quarterly basis.

These data are from the Multifactor Productivity program. To learn more, see Multifactor Productivity Trends, 2003 and 2004 (PDF) (TXT), news release USDL 06-513.