2010 (Preliminary) Multifactor Productivity Trends — 2011-05-19

Private nonfarm business sector multifactor productivity increased at a 3.2 percent annual rate in 2010, the largest increase recorded in this series which began in 1987, the U.S. Bureau of Labor Statistics reported today. (See chart 1, table A.) The multifactor productivity gain in 2010 reflected a 3.7 percent increase in output and a 0.5 percent increase in the combined inputs of capital and labor. Capital services grew by 0.6 percent, the smallest gain in the series which began in 1987. The combination of fast- rising output and a modest increase in capital services caused output per unit of capital services to jump 3.0 percent, the largest gain since the series began in 1987. Labor input, the combined effect of hours worked and labor composition, increased 0.5 percent in the private nonfarm business sector after falling in the previous two years. Multifactor productivity measures the change in output per unit of combined capital and labor.