2015 Multifactor Productivity Trends in Manufacturing — 2017-07-12

Manufacturing sector multifactor productivity decreased at a 2.8-percent annual rate in 2015, the U.S. Bureau of Labor Statistics reported today. (See chart 1, table A.) The 2015 decline was the largest decline since 2012 and reflected a 1.2-percent increase in sectoral output and a 4.1-percent increase in combined inputs. The decrease in multifactor productivity followed a 0.9-percent increase in 2014. Multifactor productivity is calculated by dividing an index of real sectoral output by an index of combined units of labor input, capital services, and intermediate inputs. Multifactor productivity annual measures differ from BLS quarterly labor productivity or output per hour measures because the former also includes information on capital services, shifts in the composition of the workforce, and intermediate inputs. Durable manufacturing sector multifactor productivity decreased at a 2.4-percent annual rate in 2015 following a 0.1-percent decrease in 2014. Nondurable manufacturing sector multifactor productivity decreased at a 2.7-percent annual rate in 2015, following a 1.5-percent increase in 2014.