June 7, 2000 (The Editor’s Desk is updated each business day.)

Factory productivity increases at 7.3-percent annual rate in first quarter

Productivity, as measured by output per hour, increased at a seasonally adjusted annual rate of 7.3 percent in manufacturing in the first quarter. Output increased 6.8 percent and hours of all persons fell 0.5 percent.

[Chart data—TXT]

The first-quarter productivity increase was smaller than the 10.8-percent increase recorded in the fourth quarter of 1999. 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.

Unit labor costs in manufacturing decreased 3.4 percent in the first quarter, after falling 5.9 percent in the fourth quarter of 1999. Unit labor costs—the cost of the labor input required to produce one unit of output—are computed by dividing labor costs in nominal terms by real output.

These data are a product of the BLS Quarterly Labor Productivity program. Data are subject to revision. Additional information is available in "Productivity and Costs, First Quarter 2000," news release USDL 00-164.