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 preliminary productivity data-as measured by output per hour of all persons--for the third quarter of 2006. The preliminary seasonally-adjusted annual rates of productivity growth in the third quarter were:

- 0.1 percent in the business sector and
- 0.0 percent in the nonfarm business sector.

Productivity increased 0.1% in the business sector, as both output and hours grew 1.4%. Nonfarm business productivity remained unchanged as output and hours both increased 1.6 %.

In manufacturing, productivity increases in the third quarter were:

- 5.9 percent in manufacturing,
- 8.6 percent in durable goods manufacturing, and
- 2.0 percent in nondurable goods manufacturing.

The 5.9% increase in manufacturing productivity reflected increases of 8.6% in durable goods manufacturing and 2.0% in the nondurable goods sector. 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.

Business

From the second quarter to the third quarter of 2006 productivity in the business sector grew at a 0.1 percent seasonally adjusted annual rate. Both output and hours of all persons engaged in the sector increased at the same 1.4 percent annual rate. The third-quarter productivity increase was slower than the 1.1-percent gain recorded in the second quarter of 2006 (as revised), which reflected a 2.7-percent rise in output and a 1.7-percent increase in hours.

Hourly compensation in the business sector increased at an annual rate of 4.0 percent during the third quarter of 2006, slower than the 6.4-percent rise one quarter earlier (as revised). This measure 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 1.0 percent in the third quarter of 2006 and 1.3 percent in the second quarter.

Unit labor costs, which reflect changes in both hourly compensation and productivity, rose 4.0 percent during the third quarter of 2006. This measure had increased 5.3 percent in the second quarter. The implicit price deflator for business sector output increased 1.3 percent during the third quarter of 2006, following a 3.1 percent increase in the previous quarter.

Nonfarm business

Productivity in the nonfarm business sector remained unchanged during the third quarter of 2006. Output grew at a 1.6 percent annual rate. Hours of all persons in the nonfarm business sector also increased 1.6 percent, reflecting 0.8-percent gains in both employment and average weekly hours at work. In the second quarter, nonfarm business productivity increased 1.2 percent, as output grew 2.7 percent and hours worked rose by 1.5 percent .

Hourly compensation increased at a 3.7 percent annual rate in the third quarter of 2006. When the rise in consumer prices is taken into account, real hourly compensation rose 0.7 percent during the July-September period. During the second quarter of 2006, real hourly compensation had increased 1.6 percent.

Unit labor costs in the nonfarm business sector grew 3.8 percent during the third quarter of 2006, after rising 5.4 percent in the second quarter. The implicit price deflator for nonfarm business output rose 1.0 percent in the third quarter of 2006.

Manufacturing

Productivity increased 5.9 percent in manufacturing in the third quarter of 2006, as output grew 4.2 percent and hours of all persons fell 1.6 percent (seasonally adjusted annual rates). This was the largest quarterly gain in productivity since the third quarter of 2003, when output per hour increased 8.6 percent. In durable goods industries, productivity grew 8.6 percent in the third quarter as output grew 5.3 percent and hours of all persons fell 3.0 percent. Productivity increased 2.0 percent in nondurable goods, reflecting increases in output and hours of 3.0 percent and 0.9 percent, respectively

The hourly compensation of manufacturing workers increased 2.9 percent during the third quarter of 2006, as a 4.8-percent gain in the durable goods subsector was partially offset by a 0.6 percent decline in nondurable goods industries. Hourly compensation in total manufacturing had increased 4.0 percent in the second quarter. When the increase in consumer prices is taken into account, real hourly compensation declined 0.1 percent in the third quarter.

Unit labor costs in manufacturing fell 2.9 percent in the third quarter of 2006, reflecting declines of 3.5 percent in durable goods industries and 2.5 percent in nondurable goods industries. These costs had increased 1.2 percent in the previous quarter.


Available at:

http://stats.bls.gov/news.release/prod2.nr0.htm