2011 First Quarter (Preliminary) Productivity and Costs — 2011-05-05

Nonfarm business sector labor productivity increased at a 1.6 percent annual rate during the first quarter of 2011, the U.S. Bureau of Labor Statistics reported today. The gain in productivity reflects increases of 3.1 percent in output and 1.4 percent in hours worked. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the first quarter of 2010 to the first quarter of 2011, output increased 3.2 percent while hours rose 1.9 percent, yielding an increase in productivity of 1.3 percent. (See tables A and 2.) Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked of all persons, including employees, proprietors, and unpaid family workers. Unit labor costs in nonfarm businesses rose 1.0 percent in the first quarter of 2011, as a 2.6 percent increase in hourly compensation outpaced the 1.6 percent gain in productivity.