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December 1993, Vol. 116,
No. 12
International comparisons of manufacturing unit labor costs
Arthur Neef, Christopher Kask, and Christopher Sparks
Among 12 countries compared—the United States, Canada, Japan, and nine Western European countries—only Sweden and the United Kingdom had larger increases in manufacturing labor productivity (output per hour) than the United States in 1992, but over the 1979-92 period, Japan and six of the European countries had higher average rates of gain.
Manufacturing unit labor costs remained unchanged between 1991 and 1992 in the United States and Canada, fell in Sweden, and rose elsewhere. Over the 1979-92 period, only Japan, Belgium, and the Netherlands had lower annual average increases than the United States. Measured on a U.S.-dollar basis - to account for relative changes in exchange rates - only Belgium and the Netherlands had lower 1979-92 average increases.
This article first examines comparative trends in manufacturing output per hour, unit labor costs, and related measures for the United States and 11 other industrial nations in the most recent year, 1992, and then discusses developments over the period 1979 to 1992. Also covered are trends in unit labor costs in Korea and Taiwan. The Bureau has not computed productivity measures for Korea and Taiwan because adequate labor input measures, for use with the output measures, have not been developed. Korea and Taiwan are included in the analysis of comparative developments in unit labor costs, however, because of the economies covered, only Canada, Japan, Germany, and the United Kingdom account for higher proportions of U.S. trade in manufactured goods than Korea or Taiwan. (Data for Germany relate to the former West Germany. For a description of the country measures, see the appendix.)
The analysis also includes relative trade-weighted measures of productivity and unit labor costs - that is, the U.S. measure relative to a trade-weighted average for the other economies or selected economies.
This excerpt is from an article published in the December 1993 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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