Productivity Fell 1.8 Percent in Second Quarter

Productivity slipped 1.8 percent during the second quarter of 2010, according to a U.S. Bureau of Labor Statistics report.


While productivity was down, output gained 1.6 percent in the quarter and hours increased 3.5 percent, the largest gain since the first quarter of 2006.

From the second quarter of 2009 to the second quarter of 2010, productivity and output both grew 3.7 percent and hours were unchanged.

Within the manufacturing sector, productivity grew 4.1 percent in the second quarter, as output rose 8.4 percent and hours worked increased 4.1 percent. In durable manufacturing, output per hour was up 9.9 percent, as output grew 13.6 percent and hours rose 3.4 percent. In nondurable goods industries, productivity fell 2.4 percent as output grew 2.8 percent but hours grew 5.3 percent.

Total manufacturing productivity was up 7.5 percent over the last four quarters and 3 percent per year on average from 2000 through 2009. Unit labor costs in manufacturing declined 5.9 percent in the second quarter of 2010 due to both the 4.1 percent increase in productivity and a 2 percent decline in hourly compensation.