The following is the unedited transcript of the news release from the Bureau of Labor Statistics of the U.S. Department of Labor.

The Bureau of Labor Statistics of the U.S. Department of Labor today reported revised productivity data--as measured by output per hour of all persons--for the first quarter of 2006. The revised seasonally adjusted annual rates of productivity change in the first quarter were:
- 3.9 percent in the business sector and
- 3.7 percent in the nonfarm business sector.

In both sectors, the first-quarter productivity gains were larger than the preliminary estimates reported on May 4.

In manufacturing, the revised productivity changes in the first quarter were:
-3.8 percent in manufacturing,
-3.5 percent in durable goods manufacturing, and
-3.7 percent in nondurable goods manufacturing.

Manufacturing productivitygrowth was slower in the first quarter of 2006 than reported on May 4, reflecting downward revisions to output per hour in both durable goods and nondurable goods industries. Output and hours in manufacturing, which includes about 13 percent of U.S. business-sector employment, tend to vary more from quarter to quarter than data for the aggregate business and nonfarm business sectors.

The data sources and methods used in the preparation of the manufacturing series differ from those used in preparing the business and nonfarm business series, and these measures are not directly comparable.

Business

Productivity increased 3.9 percent in the business sector from the fourth quarter of 2005 to the first quarter of 2006, as output increased 6.4 percent and hours worked by all persons grew 2.4 percent (seasonally adjusted annual rates). Productivity had increased 0.2 percent in the previous quarter, reflecting increases in output and hours of 1.8 percent and 1.6 percent, respectively .

Hourly compensation increased 5.4 percent during the first quarter of 2006, after declining 0.6 percent in the fourth quarter of 2005, as revised (seasonally adjusted annual rates). This measure of compensation includes wages and salaries, supplements, employer contributions to employee benefit plans, and taxes. Real hourly compensation, which takes into account changes in consumer prices, rose by 3.3 percent in the first quarter of 2006, rebounding from a 3.8-percent drop in the previous quarter.

The change in unit labor costs approximates the change in hourly compensation less the change in productivity. In the first quarter of 2006, 5.4-percent growth in hourly compensation and 3.9-percent growth in productivity yielded a 1.5-percent rise in unit labor costs. Unit labor costs declined 0.8 percent in the fourth quarter of 2005, as revised. The implicit price deflator for business output, which reflects changes in both unit labor costs and unit nonlabor payments, grew by 2.8 percent in the first quarter of 2006.

Nonfarm business

Productivity rose 3.7 percent in the nonfarm business sector during the first quarter of 2006, as output increased 6.5 percent and hours of all persons increased 2.7 percent (table 2). The hours increase was larger than during any quarter in 2005. In fourth-quarter 2005, nonfarm productivity had declined 0.3 percent as output rose 1.5 percent and hours increased 1.8 percent.

Hourly compensation increased 5.3 percent in the first quarter of 2006.

After revision, this measure decreased at a 0.9 percent annual rate in the fourth quarter of 2005--the first decline in nonfarm hourly compensation since 1994, when it fell 0.8 percent in the second quarter and 0.3 percent in the third quarter. When the rise in consumer prices is taken into account, real hourly compensation rose 3.2 in the first quarter and fell 4.1 percent in the fourth quarter.

Unit labor costs grew 1.6 percent during the first quarter of 2006, .following a 0.6-percent decline in the fourth quarter of 2005, as revised. The implicit price deflator for nonfarm business output rose by 2.9 percent in the first quarter of 2006.

Manufacturing

Productivity increased 3.8 percent in manufacturing during the first quarter of 2006, reflecting similar performance in the durable and nondurable manufacturing subsectors. In durable goods industries, productivity rose 3.5 percent, as output grew 5.2 percent and hours rose 1.6 percent. In nondurable goods industries, productivity grew 3.7 percent, as output increased 6.7 percent and hours rose 2.9 percent .

Hourly compensation in manufacturing rose 1.9 percent during the first quarter, reflecting increases of 2.7 percent in the hourly compensation of persons in durable goods industries and 0.5 percent in the hourly compensation of workers in nondurable goods industries. Real hourly compensation, which takes account of changes in consumer prices, declined 0.2 percent for all manufacturing workers, as a 0.6-percent rise in durable manufacturing real hourly compensation was eclipsed by a 1.6-percent drop in the nondurable goods industries.

Unit labor costs fell 1.9 percent in manufacturing during the first quarter of 2006. In nondurable goods industries, productivity grew much faster than hourly compensation, and unit labor costs fell 3.1 percent. In durable goods industries, where hourly compensation increased faster than in nondurable manufacturing, unit labor costs declined only 0.9 percent.

Nonfinancial corporations

Preliminary first-quarter 2006 measures of productivity and costs for nonfinancial orporations also were announced today .

Productivity rose 3.7 percent in the first quarter, as output increased 5.8percent and employee-hours rose 2.0 percent (seasonally adjusted annual rates). As revised, productivity had increased at a 2.4-percent annual rate in the fourth quarter of 2005, as output grew 5.0 percent and employee-hours rose 2.5 percent. The nonfinancial corporate sector includes all corporations doing business in the United States, except those classified as depository institutions, nondepository institutions, security and commodity brokers, insurance carriers, regulated investment offices, small business investment offices, and real estate investment trusts.

Hourly compensation rose 5.0 percent during the first quarter of 2006, following a 0.8-percent decrease in the fourth quarter of 2005. As in the larger business sector, the fourth-quarter decline was the first since the third quarter of 1994 (0.2 percent).

When the rise in consumer prices is taken into account, real hourly compensation increased 2.9 percent in the first quarter of 2006, and fell 4.0 percent in the fourth quarter of 2005.Unit labor costs in nonfinancial corporations rose 1.3 percent in the first quarter, after falling 3.2 percent one quarter earlier.