2007 Multifactor Productivity Trends — 2009-03-25

Multifactor productivity, defined as output per combined units of labor and capital inputs, grew at an annual rate of 0.4 percent in the private business sector and 0.2 percent in the private nonfarm business sector for 2007, the Bureau of Labor Statistics (BLS) and the U.S. Department of Labor reported today. Growth in multifactor productivity in the private business sector for 2007 was the slowest annual rate of growth since 2001 and for the private nonfarm business sector was the slowest since 1995. The 2006-07 annual changes are summarized in table A, and further detail and historical measures are shown in tables 1 through 6. Multifactor productivity is designed to measure the joint influences of technological change, efficiency improvements, returns to scale, reallocation of resources, and other factors on economic growth while allowing for the effects of capital and labor.