Multifactor productivity for manufacturers trends higher

Multifactor productivity, defined as output per unit of combined inputs, was reported May 1 by  the U.S. Department of Labor’s Bureau of Labor Statistics (BLS) for the manufacturing sector and for durable goods, non-durable

goods and three-digit (NAICS) manufacturing industries for the year 2006. 

In manufacturing, the annual rates of multifactor productivity change for 2006 were:

·        1.6 percent in the manufacturing sector,

·        3.2 percent in the durable goods manufacturing sector, and

·        -0.2 percent in the non-durable goods manufacturing sector.

At 1.6 percent, multifactor productivity growth in the manufacturing sector grew more rapidly than the 0.4 percent increase posted in 2005 (as revised). This occurred as durable goods manufacturing productivity growth accelerated

to 3.2 percent from 2.5 percent and non-durable goods manufacturing productivity fell less, dropping 0.2 percent in 2006 after a 1.8 percent decrease in 2005.

Multifactor productivity is designed to measure the joint influences on economic growth of technological change, efficiency improvements, returns to scale, reallocation of resources, and other factors, allowing for the effects of capital, labor and, in the case of the manufacturing sector, intermediate inputs (energy, materials, purchased business services). Multifactor productivity, therefore, differs from 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.

Read the full report and view all of the data tables by clicking on the link below:

http://www.bls.gov/news.release/prod5.htm