PRODUCTIVITY AND COSTS Fourth Quarter and Annual Averages 2011, Revised
Nonfarm business sector labor productivity increased at a 0.9 percent annual rate during the fourth quarter of 2011, the U.S. Bureau of Labor Statistics reported today. The gain in productivity reflects increases of 3.7 percent in output and 2.7 percent in hours worked. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the fourth quarter of 2010 to the fourth quarter of 2011, productivity grew 0.3 percent, as output rose 2.3 percent and hours rose 1.9 percent. Annual average productivity increased 0.4 percent from 2010 to 2011.
Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked of all persons, including employees, proprietors, and unpaid family workers. The measures released today were based on more recent source data than were available for the preliminary report.
Unit labor costs in nonfarm businesses increased 2.8 percent in the fourth quarter of 2011, as productivity grew at a slower rate (+0.9 percent) than hourly compensation (+3.7 percent). Unit labor costs rose 3.1 percent over the last four quarters. Annual average unit labor costs increased 2.0 percent from 2010 to 2011.
BLS defines unit labor costs as the ratio of hourly compensation to labor productivity; increases in hourly compensation tend to increase unit labor costs and increases in output per hour tend to reduce them.
To see the full release, go HERE: http://www.bls.gov/news.release/prod2.nr0.htm