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                PRODUCTIVITY AND COSTS
                 Second Quarter 1997

	The Bureau of Labor Statistics of the U.S. Department of Labor 
today reported revised productivity data--as measured by output per hour 
of all persons--for the second quarter of 1997.  The revised seasonally-
adjusted annual rates of productivity change in the second quarter were:

                 2.7 percent in the business sector, and
                 2.7 percent in the nonfarm business sector.

In both sectors, productivity growth was stronger than in the first 
quarter of 1997, when output per hour increased at annual rates of 1.8 
percent in the business sector and 1.4 percent in the nonfarm business 
sector.  The second-quarter productivity increases were greater than 
first reported because output was revised upward and the increases in 
hours were revised down.  (See table C.)  

	In manufacturing, the revised productivity changes in the second 
quarter were:

                 2.4 percent in manufacturing,
                 4.8 percent in durable goods manufacturing, and
                -0.3 percent in nondurable goods manufacturing.

	The second-quarter increase in manufacturing productivity combined 
a strong increase in durable goods industries with the first decrease in 
nondurable goods industries since the third quarter of 1994 (when it 
fell 0.9 percent).  Output and hours in manufacturing, which includes 
about 18 percent of U.S. business-sector employment, tend to vary more 
from quarter to quarter than data for the more aggregate business and 
nonfarm business sectors.  Second-quarter measures are summarized in 
table A and appear in detail in tables 1 through 5; the differences 
between these measures and the preliminary second-quarter figures issued 
on August 12 are shown in table C. 

	The data sources and methods used in the preparation of the 
manufacturing series differ from those used in preparing the business 
and nonfarm business series, and these measures are not directly 
comparable.  Output measures for business and nonfarm business are based 
on measures of gross domestic product prepared by the Bureau of Economic 
Analysis of the U.S. Department of Commerce.  Quarterly output measures 
for manufacturing reflect indexes of industrial production independently 
prepared by the Board of Governors of the Federal Reserve System.  See 
Technical Notes for further information on data sources.

  _______________________________________________________________________
  Table A.  Productivity and costs:  Revised second-quarter 1997 measures
 (Seasonally adjusted annual rates)
  _______________________________________________________________________
                                                        Real                                                                     Real
                                                Hourly  hourly  Unit
                        Produc-                 compen- compen- labor
  Sector		tivity	Output	Hours	sation	sation	costs
  ______________________________________________________________________
		
			Percent change from preceding quarter

  Business               2.7     4.3     1.5     3.2     2.1     0.4
  Nonfarm business       2.7     4.2     1.5     3.2     2.1     0.5
  Manufacturing          2.4     3.6     1.1     2.6     1.5     0.1
    Durable              4.8     6.7     1.8     2.0     0.9    -2.6
    Nondurable          -0.3    -0.1     0.2     3.3     2.2     3.6
  ______________________________________________________________________

			Percent change from same quarter a year ago
	
  Business               1.3     4.1     2.7     3.5     1.1     2.1
  Nonfarm business       1.2     4.1     2.8     3.5     1.1     2.2
  Manufacturing          3.5     4.6     1.0     3.0     0.6    -0.5
    Durable              4.0     5.9     1.9     2.5     0.1    -1.5
    Nondurable           3.1     2.9    -0.2     3.7     1.3     0.6
  ______________________________________________________________________

Business

	From the first quarter to the second quarter of 1997, business 
sector output per hour increased at a 2.7 percent annual rate.  This was 
the largest increase in productivity since the fourth quarter of 1993, 
when output per hour grew 4.3 percent.  During the first quarter of 
1997, productivity had increased 1.8 percent, as output grew 5.9 percent 
and hours of all persons rose 4.0 percent.  In the second quarter,  
business sector output rose 4.3 percent and hours of all persons engaged 
in the sector rose 1.5 percent (table 1).  The slower second-quarter 
hours increase reflected a 1.8 percent increase in employment and a 0.3 
percent decline in average weekly hours.  The decline in average weekly 
hours followed four quarters of increases.

	Hourly compensation increased 3.2 percent in the second quarter of 
1997, following a 4.4 percent rise in the first quarter.  This measure 
includes wages and salaries, supplements, employer contributions to 
employee benefit plans, and taxes.  Real hourly compensation, which 
takes into account changes in the Consumer Price Index for All Urban 
Consumers (CPI-U), increased at a 2.1 percent annual rate in the second 
quarter of 1997.  This was the largest gain since the first quarter of 
1992 (5.0 percent) and followed a 1.9 percent rise in the first quarter. 

	Unit labor costs, which reflect changes in hourly compensation and 
productivity, grew at a 0.4 percent annual rate during the second 
quarter, less than the 2.5 percent rise in the first quarter.  The 
implicit price deflator for the business sector, which incorporates 
changes in both unit labor costs and unit nonlabor payments, increased 
1.2 percent in the second quarter and 2.0 percent during the first 
quarter of 1997 (seasonally adjusted annual rates). 

Nonfarm business

	Productivity grew at a  2.7 percent annual rate in the nonfarm 
business sector during the second quarter of 1997, faster than at any 
time since the fourth quarter of 1993, when it rose 3.3 percent.  During 
the first quarter of 1997, nonfarm business productivity had increased 
1.4 percent, reflecting gains of 5.6 percent in output and 4.2 percent 
in hours.  Both output and hours increases slowed in the second quarter.  
Output increased 4.2 percent and hours of all persons increased 1.5 
percent (table 2).  The modest rise in hours resulted from a 1.7 percent 
increase in employment and a 0.3 percent decline in average weekly hours 
at work.  

	Hourly compensation increased 3.2 percent in the second quarter, 
compared with a 4.5 percent increase one quarter earlier (seasonally 
adjusted annual rates).  When the rise in the CPI-U is taken into 
account, real hourly compensation increased 2.1 percent in both the 
first and the second quarters of 1997.  Real hourly compensation growth 
has not exceeded 2.1 percent since the first quarter of 1992, when it 
increased 4.8 percent.  

	Unit labor costs edged up 0.5 percent during the second quarter of 
1997, the smallest increase since the second quarter of 1994, when these 
costs fell 0.2 percent. Unit labor costs had increased at a 3.1 percent 
annual rate in the first quarter.  The implicit price deflator for 
nonfarm business output rose 1.1 percent in the second quarter, down 
from the 2.4 percent gain one quarter earlier. 

Manufacturing

	Productivity increased 2.4 percent in manufacturing in the second 
quarter of 1997, as output grew 3.6 percent and hours of all persons 
increased 1.1 percent (seasonally adjusted annual rates).  In the 
previous quarter, a similar increase in productivity, 2.5 percent, 
occurred as output rose 5.4 percent while hours grew 2.8 percent.  The 
second-quarter increase in productivity was due entirely to a 4.8 
percent productivity gain in the durable goods sector, as output per 
hour worked declined 0.3 percent in the nondurable goods sector (tables 
4 and 5).

	Hourly compensation of all manufacturing workers increased 2.6 
percent during the second quarter, down from a 4.4 percent increase in 
the first quarter of 1997.  Real hourly compensation in the 
manufacturing sector rose 1.5 percent in the second quarter when the 
increase in consumer prices is taken into account.  During the first 
quarter,  real hourly compensation rose 2.0 percent.  

	Manufacturing unit labor costs edged up at a 0.1 percent annual 
rate in the second quarter of 1997, after increasing 1.8 percent in the 
first quarter.  Unit labor costs declined 2.6 percent in durable goods 
industries in the second quarter of 1997, after rising 1.7 percent in 
the first quarter.  In nondurable manufacturing, unit labor costs 
increased 3.6 percent in the second quarter and 0.7 percent in the first 
quarter of 1997.

 _________________________________________________________________________
 Table B.  Nonfinancial corporations: Preliminary second-quarter 
 productivity and cost measures
 (Seasonally adjusted annual rates)
 _________________________________________________________________________
                                             Real
                                   Hourly   hourly  Unit          Implicit
           Produc-                 compen-  compen- labor Unit    price
 Period    tivity  Output  Hours   sation   sation  costs profits deflator
 _________________________________________________________________________

                              Percent change from preceding quarter

 1997 II    3.2      5.5     2.2     3.2       2.1    0.0    4.0    0.5
 _________________________________________________________________________

                             Percent change from same quarter a year ago

 1997 II    2.4      5.3     2.9     3.5       1.1    1.1    3.1    0.8
 _________________________________________________________________________                                                      

Nonfinancial corporations

        Preliminary second-quarter 1997 measures of productivity and costs 
also were announced today for nonfinancial corporations (tables B and 
6).  Productivity increased 3.2 percent during the second quarter, as 
output rose 5.5 percent and hours increased 2.2 percent (seasonally 
adjusted annual rates).  In the first quarter of 1997, productivity had 
increased 1.9 percent in nonfinancial corporations, as output increased 
6.1 percent and employee hours rose 4.1 percent. Nonfinancial 
corporations include all corporations doing business in the United 
States, except for financial corporations, which include depository 
institutions, nondepository institutions, security and commodity 
brokers, insurance carriers, regulated investment offices, small 
business investment offices, and real estate investment trusts. 

        Hourly compensation rose 3.2 percent in the second quarter, 
down from a 4.3 percent increase one quarter earlier.  But when the 
rise in the CPI-U is taken into account, real hourly compensation 
increased 2.1 percent in the second quarter, slightly more than the 
1.9 percent rise in the first quarter of 1997 (table 6).

	Unit labor costs for nonfinancial corporations were unchanged 
in the second quarter of 1997, following a 2.3 percent rise in the 
first quarter.  Unit nonlabor costs fell 0.2 percent, and unit 
profits rose 4.0 percent.  During the first quarter, unit nonlabor 
costs had dropped 1.8 percent, and unit profits rose 3.8 percent 
(seasonally adjusted annual rates).  The implicit price deflator 
for nonfinancial corporate output rose 0.5 percent in the second 
quarter and 1.6 percent in the first quarter. 

  __________________________________________________________________
  Table C. Previous and revised productivity and related measures 
  Quarterly percent change at seasonally adjusted annual rate
  __________________________________________________________________
                                                         Real
                                               Hourly  hourly  Unit
                       Produc-                 compen- compen- labor
   Sector              tivity  Output  Hours   sation  sation  costs
  __________________________________________________________________

                               		Second quarter 1997
  Business:
   Previous		0.7	2.4	1.7	3.0	1.9	2.3
   Current		2.7	4.3	1.5	3.2	2.1	0.4

  Nonfarm business:
   Previous             0.6     2.3     1.7     3.1      2.0    2.4
   Current		2.7	4.2	1.5	3.2	 2.1	0.5

  Manufacturing:
   Previous             3.2     4.4     1.2     2.7      1.6   -0.4
   Current              2.4     3.6     1.1     2.6      1.5    0.1
  __________________________________________________________________

Revised Measures

	Current and previous measures for the second quarter of 1997 for 
the business, nonfarm business, and manufacturing sectors are compared 
in table C.  The quarterly movements differ from those reported on 
August 12 based on information then available.  In the business and 
nonfarm business sectors, changes in output (which are based on 
information from the national income and product accounts prepared by 
the U.S. Department of Commerce) and productivity were revised up, and 
the increase in hours was revised down.  Manufacturing output (which is 
based on information from the Federal Reserve Board) and productivity 
were revised down.

Next release date

	The next release of Productivity and Costs is scheduled for 10:00 
AM EST, Thursday, November 13, 1997.  Revised second-quarter measures 
for nonfinancial corporations and preliminary third-quarter measures for 
business, nonfarm business, and manufacturing will be released at that 
time.

                                TECHNICAL NOTES
                                      
                                      
                                      
 Labor  Hours:  The primary source of hours and employment  data  is  the  BLS
 Current  Employment Statistics (CES) program, which provides  monthly  survey
 data on total employment and average weekly paid hours of production and non-
 supervisory  workers  in  nonagricultural establishments.  Jobs  rather  than
 persons  are counted. Weekly paid hours are adjusted to hours at  work  using
 the BLS Hours at Work survey, conducted for this purpose.
       Data  from  the BLS Current Population Survey (CPS) are used  for  farm
 labor; in the nonfarm sector, the National Income and Product Accounts (NIPA)
 prepared  by the Bureau of Economic Analysis (BEA) of the Department  of Com-
 merce and the CPS are used to measure labor input for government enterprises,
 proprietors, and unpaid family workers.
 
 Output: Business sector output is an annual-weighted index constructed  after
 excluding  from  gross domestic product (GDP) the following outputs:  General
 government, nonprofit institutions, paid employees of private households, and
 the  rental value of owner-occupied dwellings. Corresponding exclusions  also
 are  made in labor inputs. Business output accounted for about 76 percent  of
 the  value  of  GDP  in 1992. Nonfarm business, which also excludes  farming,
 accounted for about 75 percent of GDP in 1992.
      Annual manufacturing indexes are constructed by deflating current-dollar
 industry  value  of production data from the U.S. Bureau of the  Census  with
 deflators  from  the BEA.  These deflators are based on  data  from  the  BLS
 producer  price  program  and  other sources.   The  industry  shipments  are
 aggregated  using annual weights, and intrasector transactions  are  removed.
 Quarterly  manufacturing output measures are based on the index of industrial
 production prepared monthly by the Board of Governors of the Federal  Reserve
 System  adjusted to be consistent with annual indexes of manufacturing sector
 output  prepared  by  BLS.   Durables  include  the  following  2-digit   SIC
 industries:   Primary  metal  industries;  fabricated  metal  products;  non-
 electrical  machinery;  industrial  and  commercial  machinery  and  computer
 equipment;   electronic   and  other  electrical  equipment;   transportation
 equipment;  instruments; lumber and lumber products; furniture and  fixtures;
 stone, clay, and glass and concrete products; and miscellaneous manufactures.
 Nondurables  include:  Food and kindred products, tobacco  products,  textile
 mill  products,  apparel  products, paper and allied products,  printing  and
 publishing,  chemicals and chemical products, petroleum refining and  related
 industries, rubber and plastic products, and leather and leather products.
      Nonfinancial corporate output is an annual-weighted index constructed by
 excluding  from  GDP  the  following outputs: General  government;  nonprofit
 institutions; employees of private households; the rental value  of owner-oc-
 cupied  dwellings; unincorporated business; and those corporations which  are
 depository  institutions, nondepository institutions, security and  commodity
 brokers,  insurance  carriers, regulated investment offices,  small  business
 investment   offices,   and  real  estate  investment  trusts.   Nonfinancial
 corporations accounted for about 52 percent of the value of GDP in 1992.
 
 Productivity:  These productivity measures describe the relationship  between
 real  output  and the labor time involved in its production.  They  show  the
 changes  from  period to period in the amount of goods and services  produced
 per  hour.  Although these measures relate output to hours  at  work  of  all
 persons engaged in a sector, they do not measure the specific contribution of
 labor,  capital, or any other factor of production. Rather, they reflect  the
 joint  effects  of many influences, including changes in technology;  capital
 investment; level of output; utilization of capacity, energy, and  materials;
 the organization of production; managerial skill; and the characteristics and
 effort of the work force.
 
       Information  in this release will be made available to sensory-impaired
 individuals upon request. Voice phone: 202-606-STAT; TDD phone: 202-606-5897;
 TDD message referral phone number: 1-800-326-2577.
 
 
  Table 1. Business sector:   Productivity, hourly compensation, unit labor costs,
  and prices, seasonally adjusted
                                                             Real
     Year       Output per             Hours     Compensa-   compensa-   Unit     Unit non-   Implicit
     and        hour of                of all    tion per    tion per    labor    labor pay-  price
     quarter    all persons  Output    persons   hour (1)    hour (2)    costs    ments (3)   deflator (4)
  ---------------------------------------------------------------------------------------------------------
                                           Indexes 1992=100

  1995       I     100.2      108.7     108.5     105.8        98.3      105.6       108.3      106.5
            II     100.4      108.7     108.3     106.6        98.3      106.1       108.4      107.0
           III     100.6      109.8     109.2     107.3        98.4      106.7       108.8      107.4
            IV     101.1      110.7     109.5     108.1        98.6      107.0       109.2      107.8

        ANNUAL     100.5      109.5     108.9     106.9        98.4      106.3       108.7      107.2

  1996       I     101.6      111.4     109.6     108.9        98.4      107.1       110.6      108.4
            II     102.3      113.2     110.7     110.1        98.8      107.7       111.1      108.9
           III     102.0      113.5     111.3     111.0        98.9      108.8       110.8      109.6
            IV     102.5      115.0     112.2     111.9        98.9      109.2       111.4      110.0

        ANNUAL     102.0      113.3     111.0     110.4        98.7      108.2       111.0      109.2

  1997       I     102.9      116.6     113.3     113.1        99.4      109.9       111.8      110.6
            II    r103.6     r117.9    r113.7     114.0       r99.9     r110.0      r112.5     r110.9
  ---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

  1995       I      -2.1        0.8       2.9       2.6        -0.2        4.8        -0.2        2.9
            II       0.9        0.2      -0.7       3.2         0.1        2.3         0.4        1.6
           III       0.7        4.2       3.5       2.6         0.5        1.9         1.4        1.7
            IV       2.0        3.0       1.0       3.2         0.7        1.2         1.5        1.3

        ANNUAL       0.0        2.3       2.4       2.5        -0.3        2.6         1.7        2.3

  1996       I       2.2        2.8       0.6       2.7        -0.6        0.5         5.3        2.3
            II       2.5        6.6       4.0       4.7         1.3        2.2         1.9        2.1
           III      -1.1        0.9       2.0       3.3         0.6        4.4        -1.0        2.4
            IV       1.9        5.4       3.4       3.3        -0.1        1.4         2.2        1.7

        ANNUAL       1.5        3.5       2.0       3.3         0.3        1.8         2.2        1.9

  1997       I       1.8        5.9       4.0       4.4         1.9        2.5         1.1        2.0
            II      r2.7       r4.3      r1.5      r3.2        r2.1       r0.4        r2.5       r1.2
  ---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

  1995       I      -0.5        3.3       3.8       1.7        -1.2        2.2         3.2        2.6
            II      -0.3        1.7       2.1       2.5        -0.5        2.8         1.7        2.4
           III       0.0        2.4       2.3       2.7         0.1        2.7         1.3        2.2
            IV       0.4        2.0       1.7       2.9         0.3        2.5         0.8        1.9

        ANNUAL       0.0        2.3       2.4       2.5        -0.3        2.6         1.7        2.3

  1996       I       1.4        2.5       1.1       2.9         0.2        1.5         2.1        1.7
            II       1.8        4.2       2.3       3.3         0.5        1.5         2.5        1.8
           III       1.4        3.3       1.9       3.5         0.5        2.1         1.9        2.0
            IV       1.4        3.9       2.5       3.5         0.3        2.1         2.1        2.1

        ANNUAL       1.5        3.5       2.0       3.3         0.3        1.8         2.2        1.9

  1997       I       1.3        4.7       3.4       3.9         0.9        2.6         1.1        2.0
            II      r1.3       r4.1      r2.7       3.5         1.1       r2.1        r1.2        1.8
  ---------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                       September 9, 1997 
  r=revised                                                              Source: Bureau of Labor Statistics

  Table 2. Nonfarm business sector:   Productivity, hourly compensation, unit labor costs,
  and prices, seasonally adjusted
                                                             Real
     Year       Output per             Hours     Compensa-   compensa-   Unit     Unit non-   Implicit
     and        hour of                of all    tion per    tion per    labor    labor pay-  price
     quarter    all persons  Output    persons   hour (1)    hour (2)    costs    ments (3)   deflator (4)
  ---------------------------------------------------------------------------------------------------------
                                           Indexes 1992=100

  1995       I     100.3      108.9     108.5     105.6        98.2      105.3       109.5      106.8
            II     100.5      108.9     108.4     106.4        98.1      105.8       109.6      107.2
           III     100.8      110.2     109.3     107.1        98.3      106.3       109.7      107.5
            IV     101.2      111.0     109.7     107.9        98.4      106.6       109.8      107.8

        ANNUAL     100.7      109.8     109.0     106.7        98.3      106.0       109.7      107.3

  1996       I     101.7      111.7     109.8     108.7        98.3      106.9       111.1      108.4
            II     102.2      113.5     111.0     109.8        98.5      107.4       111.4      108.8
           III     102.0      113.8     111.6     110.6        98.6      108.5       111.0      109.4
            IV     102.4      115.3     112.6     111.5        98.5      108.9       111.6      109.8

        ANNUAL     102.0      113.6     111.3     110.1        98.4      107.9       111.3      109.1

  1997       I     102.8      116.9     113.8     112.8        99.1      109.7       111.9      110.5
            II    r103.5     r118.1     114.2    r113.7       r99.6     r109.8      r112.4     r110.8
  ---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

  1995       I      -1.6        1.2       2.9       2.6        -0.2        4.2         1.3        3.1
            II       0.8        0.2      -0.6       3.1        -0.1        2.3         0.2        1.5
           III       1.1        4.6       3.5       2.7         0.6        1.6         0.5        1.2
            IV       1.6        3.0       1.4       2.9         0.5        1.3         0.3        1.0

        ANNUAL       0.2        2.6       2.4       2.5        -0.3        2.4         2.1        2.3

  1996       I       1.9        2.6       0.6       2.8        -0.5        0.9         4.8        2.3
            II       2.2        6.8       4.4       4.4         1.0        2.1         1.1        1.7
           III      -1.0        1.0       2.1       2.9         0.2        3.9        -1.3        2.0
            IV       1.8        5.4       3.6       3.3        -0.1        1.5         2.0        1.7

        ANNUAL       1.3        3.5       2.2       3.1         0.2        1.8         1.5        1.7

  1997       I       1.4        5.6       4.2       4.5         2.1        3.1         1.0        2.4
            II      r2.7       r4.2      r1.5      r3.2        r2.1       r0.5        r2.1       r1.1
  ---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

  1995       I      -0.2        3.5       3.7       1.8        -1.1        2.0         4.3        2.8
            II      -0.2        1.9       2.1       2.4        -0.6        2.6         2.4        2.6
           III       0.4        2.7       2.3       2.8         0.1        2.4         1.5        2.1
            IV       0.4        2.2       1.8       2.8         0.2        2.4         0.6        1.7

        ANNUAL       0.2        2.6       2.4       2.5        -0.3        2.4         2.1        2.3

  1996       I       1.3        2.6       1.2       2.9         0.1        1.5         1.4        1.5
            II       1.7        4.2       2.5       3.2         0.4        1.5         1.7        1.6
           III       1.2        3.3       2.1       3.3         0.3        2.1         1.2        1.7
            IV       1.2        3.9       2.7       3.3         0.2        2.1         1.6        1.9

        ANNUAL       1.3        3.5       2.2       3.1         0.2        1.8         1.5        1.7

  1997       I       1.1        4.7       3.6       3.8         0.8        2.7         0.7        1.9
            II      r1.2       r4.1      r2.8      r3.5        r1.1       r2.2        r0.9       r1.8
  ---------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                       September 9, 1997
  r=revised                                                              Source: Bureau of Labor Statistics

  Table 3. Manufacturing sector:   Productivity, hourly compensation, and unit labor costs,
  seasonally adjusted
                                                                              Real
       Year           Output per                  Hours       Compensa-       compensa-      Unit 
       and            hour of                     of all      tion per        tion per       labor
       quarter        all persons     Output      persons     hour (1)        hour (2)       costs
  --------------------------------------------------------------------------------------------------
                                             Indexes 1992=100

  1995       I            106.7        112.3        105.2        107.2           99.6         100.5
            II            107.6        111.9        104.0        108.2           99.8         100.5
           III            108.8        112.7        103.6        109.2          100.2         100.4
            IV            109.2        113.0        103.4        110.1          100.4         100.8

        ANNUAL            108.1        112.5        104.1        108.7          100.1         100.6

  1996       I            110.3        113.3        102.7        110.8          100.2         100.4
            II            111.0        115.0        103.7        112.1          100.5         101.0
           III            112.4        116.4        103.6        112.9          100.6         100.4
            IV            113.5        117.7        103.7        113.5          100.3         100.0

        ANNUAL            111.7        115.6        103.5        112.2          100.3         100.5

  1997       I            114.2        119.2        104.4        114.7          100.8         100.4
            II           r114.9       r120.3        104.7       r115.4         r101.1        r100.5
  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  1995       I              3.8          4.4          0.6          2.1           -0.6          -1.6
            II              3.5         -1.2         -4.5          3.8            0.7           0.3
           III              4.3          2.7         -1.5          3.9            1.7          -0.4
            IV              1.7          1.0         -0.7          3.2            0.7           1.4

        ANNUAL              3.2          3.5          0.3          2.9            0.1          -0.3

  1996       I              4.0          1.1         -2.7          2.5           -0.8          -1.4
            II              2.4          6.3          3.8          4.7            1.3           2.2
           III              5.5          5.0         -0.5          3.2            0.5          -2.2
            IV              3.7          4.3          0.6          1.9           -1.4          -1.7

        ANNUAL              3.3          2.8         -0.5          3.2            0.2          -0.1

  1997       I              2.5          5.4          2.8          4.4            2.0           1.8
            II             r2.4         r3.6         r1.1         r2.6           r1.5          r0.1
  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  1995       I              2.9          5.7          2.8          2.0           -0.9          -0.9
            II              2.7          3.5          0.9          2.8           -0.2           0.1
           III              3.4          3.1         -0.3          3.1            0.5          -0.3
            IV              3.3          1.7         -1.6          3.3            0.6          -0.1

        ANNUAL              3.2          3.5          0.3          2.9            0.1          -0.3

  1996       I              3.4          0.9         -2.4          3.3            0.6           0.0
            II              3.1          2.8         -0.3          3.6            0.7           0.5
           III              3.4          3.3         -0.1          3.4            0.4           0.0
            IV              3.9          4.1          0.3          3.1           -0.1          -0.8

        ANNUAL              3.3          2.8         -0.5          3.2            0.2          -0.1

  1997       I              3.5          5.2          1.7          3.5            0.6           0.0
            II             r3.5         r4.6          1.0         r3.0           r0.6         r-0.5
  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                September 9, 1997
  r=revised                                                       Source: Bureau of Labor Statistics

  Table 4. Durable manufacturing sector:   Productivity, hourly compensation, and unit labor costs,
  seasonally adjusted
                                                                              Real
       Year           Output per                  Hours       Compensa-       compensa-      Unit 
       and            hour of                     of all      tion per        tion per       labor
       quarter        all persons     Output      persons     hour (1)        hour (2)       costs
  --------------------------------------------------------------------------------------------------
                                             Indexes 1992=100

  1995       I            110.8        118.4        106.9        107.1           99.5          96.7
            II            111.3        118.0        106.0        107.9           99.5          96.9
           III            112.8        119.5        106.0        108.8           99.8          96.4
            IV            113.5        120.5        106.2        109.3           99.7          96.4

        ANNUAL            112.1        119.1        106.3        108.2           99.7          96.6

  1996       I            115.1        121.6        105.6        109.8           99.3          95.3
            II            116.3        124.7        107.2        111.1           99.6          95.5
           III            118.0        126.5        107.2        111.8           99.6          94.7
            IV            118.7        127.4        107.4        111.9           98.9          94.3

        ANNUAL            116.9        125.0        107.0        111.0           99.2          95.0

  1997       I            119.5        129.9        108.7        113.2           99.5          94.7
            II           r120.9       r132.1        109.2       r113.8          r99.7          94.1
  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  1995       I              5.7          6.7          0.9          2.3           -0.4          -3.2
            II              2.1         -1.4         -3.4          3.0           -0.1           1.0
           III              5.4          5.3         -0.1          3.4            1.2          -1.9
            IV              2.4          3.4          0.9          2.1           -0.3          -0.3

        ANNUAL              4.0          5.3          1.3          2.6           -0.2          -1.3

  1996       I              6.0          3.7         -2.2          1.6           -1.7          -4.2
            II              4.0         10.3          6.1          4.8            1.4           0.8
           III              6.2          6.0         -0.2          2.7            0.0          -3.4
            IV              2.1          2.8          0.7          0.5           -2.7          -1.6

        ANNUAL              4.3          5.0          0.7          2.5           -0.4          -1.7

  1997       I              3.0          8.3          5.2          4.7            2.3           1.7
            II             r4.8         r6.7         r1.8         r2.0           r0.9         r-2.6
  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  1995       I              4.1          8.0          3.7          1.7           -1.1          -2.3
            II              3.4          5.4          1.9          2.5           -0.6          -0.9
           III              3.9          4.7          0.7          2.8            0.2          -1.1
            IV              3.9          3.4         -0.4          2.7            0.1          -1.1

        ANNUAL              4.0          5.3          1.3          2.6           -0.2          -1.3

  1996       I              4.0          2.7         -1.2          2.5           -0.2          -1.4
            II              4.4          5.6          1.2          3.0            0.1          -1.4
           III              4.6          5.8          1.1          2.8           -0.2          -1.8
            IV              4.6          5.7          1.1          2.4           -0.8          -2.1

        ANNUAL              4.3          5.0          0.7          2.5           -0.4          -1.7

  1997       I              3.8          6.8          2.9          3.2            0.2          -0.6
            II             r4.0         r5.9          1.9          2.5           r0.1          -1.5
  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                September 9, 1997
  r=revised                                                       Source: Bureau of Labor Statistics

  Table 5. Nondurable manufacturing sector:   Productivity, hourly compensation, and unit labor costs,
  seasonally adjusted
                                                                              Real
       Year           Output per                  Hours       Compensa-       compensa-      Unit 
       and            hour of                     of all      tion per        tion per       labor
       quarter        all persons     Output      persons     hour (1)        hour (2)       costs
  --------------------------------------------------------------------------------------------------
                                             Indexes 1992=100

  1995       I            102.9        105.9        103.0        107.0           99.5         104.1
            II            104.1        105.6        101.4        108.3           99.9         104.0
           III            105.0        105.5        100.5        109.5          100.4         104.3
            IV            105.3        105.0         99.7        110.7          100.9         105.1

        ANNUAL            104.4        105.5        101.1        108.9          100.3         104.4

  1996       I            105.8        104.5         98.8        111.7          101.1         105.7
            II            106.0        104.9         99.0        112.8          101.2         106.4
           III            107.2        105.9         98.7        113.9          101.5         106.3
            IV            108.7        107.4         98.8        115.1          101.8         106.0

        ANNUAL            106.8        105.7         99.0        113.3          101.3         106.1

  1997       I            109.4        108.0         98.7        116.1          102.0         106.1
            II           r109.3       r107.9         98.7        117.1          102.6        r107.1
  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  1995       I              1.3          1.4          0.1          1.7           -1.0           0.5
            II              5.1         -1.3         -6.0          4.7            1.6          -0.3
           III              3.3         -0.4         -3.5          4.4            2.3           1.1
            IV              1.2         -1.8         -3.0          4.6            2.1           3.3

        ANNUAL              2.3          1.2         -1.1          3.2            0.4           0.9

  1996       I              1.7         -1.9         -3.5          3.8            0.5           2.1
            II              1.0          1.6          0.5          4.0            0.6           2.9
           III              4.6          3.7         -0.9          3.9            1.2          -0.6
            IV              5.5          5.9          0.4          4.3            0.9          -1.1

        ANNUAL              2.3          0.2         -2.1          4.0            1.0           1.7

  1997       I              2.7          2.1         -0.6          3.4            1.0           0.7
            II            r-0.3        r-0.1          0.2         r3.3           r2.2          r3.6
  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  1995       I              1.6          3.2          1.6          2.1           -0.7           0.5
            II              1.8          1.3         -0.5          3.0            0.0           1.2
           III              2.8          1.0         -1.8          3.4            0.7           0.5
            IV              2.7         -0.5         -3.1          3.9            1.2           1.1

        ANNUAL              2.3          1.2         -1.1          3.2            0.4           0.9

  1996       I              2.8         -1.3         -4.0          4.4            1.6           1.5
            II              1.8         -0.6         -2.4          4.2            1.3           2.4
           III              2.1          0.4         -1.7          4.1            1.1           1.9
            IV              3.2          2.3         -0.9          4.0            0.8           0.8

        ANNUAL              2.3          0.2         -2.1          4.0            1.0           1.7

  1997       I              3.4          3.3         -0.1          3.9            0.9           0.5
            II             r3.1         r2.9         -0.2         r3.7           r1.3          r0.6
  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                September 9, 1997
  r=revised                                                       Source: Bureau of Labor Statistics

  Table 6. Nonfinancial corporations:   Productivity, hourly compensation, unit labor costs, unit profits,
  and prices, seasonally adjusted
 
                Output                      Hourly    Real                Unit     Total    Unit   Implicit
      Year      per all-                    compen-   hourly     Unit     non-     unit     pro-   price
      and       employee          Employee  sation    compen-    labor    labor    costs    fits   deflator
      quarter   hour      Output  hours      (1)      sation(2)  costs    costs(6) (7)      (8)      (4)
  ----------------------------------------------------------------------------------------------------------
                                             Indexes 1992=100

  1995       I    103.0    112.3     109.1    105.2      97.8     102.2     99.8    101.6    135.2    104.6
            II    103.5    112.9     109.1    106.0      97.7     102.4    100.1    101.8    134.9    104.8
           III    104.7    114.9     109.7    106.6      97.8     101.9     99.0    101.1    145.5    105.1
            IV    105.2    115.9     110.2    107.3      97.8     102.0     99.1    101.2    147.3    105.4

        ANNUAL    104.1    114.0     109.5    106.3      97.9     102.1     99.5    101.4    140.8    105.0

  1996       I    105.6    116.5     110.4    107.8      97.5     102.1     99.2    101.4    152.5    106.0
            II    106.4    118.7     111.5    109.0      97.8     102.4     98.4    101.4    154.7    106.2
           III    107.0    120.0     112.1    109.9      97.9     102.7     98.1    101.5    156.0    106.4
            IV    107.6    121.5     113.0    110.7      97.8     102.9     97.4    101.5    156.4    106.5

        ANNUAL    106.6    119.2     111.8    109.4      97.8     102.6     98.3    101.4    154.9    106.3

  1997       I    108.1    123.3     114.1    111.9      98.3     103.5     97.0    101.8    157.9    106.9
            II    108.9    125.0     114.7    112.8      98.8     103.5     96.9    101.8    159.4    107.0
  ----------------------------------------------------------------------------------------------------------
                             Percent change from previous quarter at annual rate(5)

  1995       I     -3.1      0.0       3.2      2.4      -0.4       5.6      2.8      4.9    -18.1      1.8
            II      1.9      2.0       0.1      3.0      -0.1       1.0      1.0      1.0     -0.8      0.8
           III      4.8      7.2       2.3      2.5       0.4      -2.2     -4.2     -2.7     35.4      1.3
            IV      2.1      3.8       1.7      2.5       0.1       0.4      0.4      0.4      4.9      1.0

        ANNUAL      0.8      3.7       2.9      2.3      -0.5       1.5     -0.2      1.1      4.7      1.5

  1996       I      1.3      2.0       0.7      2.0      -1.2       0.7      0.6      0.7     15.0      2.4
            II      3.3      7.6       4.2      4.4       1.0       1.1     -3.1      0.0      5.8      0.7
           III      2.3      4.3       2.0      3.4       0.7       1.1     -1.4      0.5      3.5      0.9
            IV      2.0      5.2       3.2      2.9      -0.4       0.9     -2.8      0.0      1.0      0.1

        ANNUAL      2.4      4.5       2.1      2.9      -0.1       0.4     -1.2      0.0     10.0      1.2

  1997       I      1.9      6.1       4.1      4.3       1.9       2.3     -1.8      1.3      3.8      1.6
            II      3.2      5.5       2.2      3.2       2.1       0.0     -0.2     -0.1      4.0      0.5
  ----------------------------------------------------------------------------------------------------------
                          Percent change from corresponding quarter of previous year

  1995       I     -0.6      3.9       4.6      1.6      -1.3       2.2     -1.7      1.2      6.6      1.8
            II      0.4      3.5       3.0      2.2      -0.8       1.8      1.3      1.7      1.9      1.7
           III      1.5      4.3       2.7      2.5      -0.1       1.0     -0.5      0.6      6.7      1.3
            IV      1.4      3.2       1.8      2.6       0.0       1.2      0.0      0.9      3.6      1.2

        ANNUAL      0.8      3.7       2.9      2.3      -0.5       1.5     -0.2      1.1      4.7      1.5

  1996       I      2.5      3.7       1.2      2.5      -0.2       0.0     -0.6     -0.2     12.8      1.4
            II      2.9      5.1       2.2      2.9       0.0       0.0     -1.6     -0.4     14.6      1.3
           III      2.3      4.4       2.1      3.1       0.1       0.8     -0.9      0.4      7.2      1.2
            IV      2.2      4.8       2.5      3.2       0.0       1.0     -1.7      0.3      6.2      1.0

        ANNUAL      2.4      4.5       2.1      2.9      -0.1       0.4     -1.2      0.0     10.0      1.2

  1997       I      2.4      5.8       3.3      3.8       0.8       1.3     -2.3      0.4      3.5      0.8
            II      2.4      5.3       2.9      3.5       1.1       1.1     -1.5      0.4      3.1      0.8
  ----------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                        September 9, 1997
  r=revised                                                               Source: Bureau of Labor Statistics

SOURCES:  Output data are from the Bureau of Economic Analysis and the Census
Bureau of the U.S. Department of Commerce; the Bureau of Labor Statistics,
U.S. Department of Labor; and the Federal Reserve Board.  Compensation and
hours data are from the Bureau of Labor Statistics  and the Bureau of
Economic Analysis.

RELIABILITY:  Productivity and cost measures are regularly revised as more
complete information becomes available.  The measures are first published 30
days after the close of the reference period; revisions appear 30 days later,
and second revisions after an additional 60 days.

                            Footnotes, Tables 1-6

(1)  Wages and salaries of employees plus employers' contributions for social
     insurance and private benefit plans.  Except for nonfinancial
     corporations, where there are no self-employed, data also include an
     estimate of wages, salaries, and supplemental payments for the self-
     employed.

(2)  Compensation per hour adjusted for changes in the Consumer Price Index
     for All Urban Consumers.

(3)  Unit nonlabor payments include profits, capital consumption allowances,
     interest, rental income of persons, and indirect taxes.

(4)  Current dollar output divided by the output index.

(5)  Quarterly changes:  Percent change compounded at annual rate from the
     original data rather than index numbers.  Annual changes:  Percent
     change between annual average levels.

(6)  Unit nonlabor costs include capital consumption allowances, interest,
     rental income of persons, and indirect taxes.  For nonfinancial
     corporations, rental income of persons is zero by definition.

(7)  Total unit costs are the sum of unit labor and nonlabor costs.

(8)  Unit profits include corporate profits with inventory valuation and
     capital consumption adjustments.