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Historical, technical                              USDL 01-82
information:    (202) 691-5606                     For Release: 10:00 AM  EDT
Media contact:  (202) 691-5902                     Tuesday, April 10, 2001


		     MULTIFACTOR PRODUCTIVITY TRENDS, 1999

	  Private Business, Private Nonfarm Business, and Manufacturing


    The Bureau of Labor Statistics of the U.S. Department of Labor today 
reported multifactor productivity data--output per unit of combined inputs--
for 1999. Multifactor productivity is designed to measure the joint 
influences on economic growth of technological change, efficiency 
improvements, returns to scale, reallocation of resources, and other factors.  
Multifactor productivity, therefore, differs from the labor productivity 
(output per hour) measures that are published quarterly by BLS since it 
requires information on capital services and other data that are not 
available on a quarterly basis.  

    In 1999, multifactor productivity in the private business and private 
nonfarm business sectors changed at the following percentage rates:

						1998-99
		Private business                  0.8
		Private nonfarm business          0.6

    Multifactor productivity increased for the eighth consecutive year in 
both the private business and private nonfarm business sectors, but at the 
lowest rates since 1995. The 1999 annual changes are summarized in tables A 
and C; further detail and historical measures are shown in tables 1 through 9.

    In manufacturing, increases in multifactor productivity for 1999 were:

						1998-99
		Manufacturing                     0.7

    Multifactor productivity also increased for the eighth consecutive 
year in manufacturing; this was the slowest rate since multifactor 
productivity actually declined in 1989, 1990 and 1991. 


    The data sources and methods used in the preparation of the manufacturing 
series differ from those used in preparing the private business and private 
nonfarm business series, and these measures are not directly comparable.  
See page 8 and the Summary of Methods for further information on data 
sources and methods.

    Chart 1 shows the annual indexes of multifactor productivity, output per 
hour worked, and output per unit of capital services for 1948-1999 for the 
private business sector.  Over the last 50 years, capital services have grown 
more rapidly than hours in the private business sector.  The skills of 
workers as measured by their education and worker experience have also risen 
over this period.  These shifts toward more capital intensive production and 
to workers with more human capital have supplemented multifactor productivity 
growth.  As a result, output per hour has usually grown at a faster rate than 
multifactor productivity.  However, short-term fluctuations of multifactor 
productivity and output per hour generally move in the same direction. 


Private business and private nonfarm business

    In private business and private nonfarm business, the change in 
multifactor productivity reflects the difference between the change in real 
gross domestic product for the sector and the change in labor and capital 
inputs engaged in the production of this output.  The output measures for 
private business and private nonfarm business are similar to the indexes of 
output for business and nonfarm business used in the quarterly labor 
productivity measures, but omit the output of government enterprises.  

    A change in multifactor productivity reflects the change in output that 
cannot be accounted for by the change in combined inputs of labor and 
capital.  In contrast, a change in labor productivity reflects the change in 
output that cannot be accounted for by the change in hours of all persons 
engaged in production.


Changes in 1998-99

Private business sector

    Multifactor productivity rose 0.8 percent in 1999, the lowest rate of 
increase since 1995.  Multifactor productivity has not declined since the 
recession year of 1991.  The multifactor productivity gain in 1999 reflected 
a 4.8 percent increase in output and a 3.9 percent increase in the combined 
inputs of capital and labor.  By comparison, in 1998, the rate of increase 
was 5.1 percent in output and 3.6 percent in combined inputs. 

    In 1999, capital services grew by 6.4 percent, while labor input grew by 
2.7 percent.  The disparity between capital services growth and labor input 
growth was the largest since 1982 (table 4).  In fact, capital services 
showed the steepest gain since the time series started in 1948-49.  Equipment 
and inventories grew more rapidly than the other asset categories (table 7). 
Equipment posted its largest growth rate ever, 11.6 percent, since 1949.  The 
growth in equipment has accelerated during the entire 1992-99 period.  

Table A.  Productivity and related data, percent changes, 1998-99

					     Private     Private
					     Business1   Nonfarm 
							 Business1

Productivity
  Multifactor Productivity2                     0.8         0.6
    Output per hour of all persons              2.7         2.5
    Output per unit of capital services        -1.6        -1.8

Output                                          4.8         4.7

Inputs
  Labor input3                                  2.7         2.9
    Hours                                       2.0         2.2
    Labor Composition4                          0.6         0.7
  Capital services                              6.4         6.6
  Combined units of labor and capital inputs5   3.9         4.1

Analytic ratio:
  Capital services per hour of all persons      4.3         4.3

1.  Excludes government enterprises.
2.  Output per unit of combined labor and capital inputs.
3.  Index of hours worked; hours worked by education and experience group 
    are weighted by each groups share of labor compensation.
4.  Ratio of labor input to hours.
5.  Labor input index combined with capital service input index, 
    weighted by labor's and capital's shares of nominal output.



    Labor input in 1999 continued to grow faster than the average for the 
1990s.  The growth rate of labor input reflects the growth rate of hours at 
work, adjusted for the effects of changing labor composition.  Changes in 
hours at work reflect the combined effects of changes in the average work 
week and employment.  In previous years, labor input followed a pattern of 
small declines in the work week and modest increases in labor composition.  
Labor input in 1999, however, reflected small increases in the work week as 
well as relatively large increases in labor composition.  Employment 
continues to be the principal source of labor input growth.  Employment rose 
1.8 percent in 1999, accounting for two-thirds of the increase in labor input.  
   
    Unlike multifactor productivity, labor productivity continued to grow at 
almost the same rate in 1999 as in 1998.  Labor productivity (output per hour 
worked) increased 2.7 percent in 1999.  Capital productivity (output per 
unit of capital services) fell 1.6 percent, the lowest rate since 1991.  
Capital services per hour jumped 4.3 percent, the largest gain since 1991.

	Private nonfarm business

    Multifactor productivity in the private nonfarm business sector increased 
by 0.6 percent in 1999.  This was the eighth consecutive year of growth, but 
the lowest rate since 1995.  Output showed a 4.7 percent rate of growth.  The 
growth of combined units of capital and labor inputs was 4.1 percent.  By 
comparison, in 1998, the rate of increase was 5.2 percent in output and 3.7 
percent in combined inputs. Labor input grew 2.9 percent in 1999; a little 
more than two-thirds of this growth was due to increased employment.  Capital 
services growth continued to accelerate, increasing 6.6 percent in 1999, the 
largest gain since the series began in 1948. The fastest growing component of 
capital services was equipment, which posted its steepest gain ever (table 8).

    Labor productivity grew 2.5 percent in 1999.  Capital productivity dipped 
1.8 percent.  In 1999, capital services per hour increased at its highest 
rate since 1991, posting a 4.3 percent gain.

Long-term trends in private business and private nonfarm business

    Labor productivity (output per hour) differs from multifactor productivity 
(output per unit of combined capital and labor inputs) in the treatment of 
both capital and hours. Labor productivity measures do not explicitly account 
for the effects of capital or of changes in the composition of labor on output 
growth.  As a result, changes in capital intensity (the capital-hours ratio) 
and labor composition can influence labor productivity growth.  In contrast, 
multifactor productivity treats capital as an explicit factor of production, 
and, therefore, is net of changes in capital intensity.  In addition, the 
labor input measure used to calculate multifactor productivity reflects the 
combined effects of changes in hours at work and of shifts in the educational 
attainment and in the experience of the work force.  Therefore, multifactor 
productivity accounts for changes in labor composition as well.  Long-term 
labor productivity growth can be viewed as the sum of three components: 
multifactor productivity growth, the contribution of increased capital 
intensity, and the contribution of shifts in labor composition (table B and 
chart 2).

    The contribution of capital intensity equals the change in the capital-
hours ratio multiplied by capital's share of total payments to inputs.  The 
contribution of labor composition equals the difference between the growth 
rate of labor input and the growth rate of hours multiplied by labor's share 
of total payments.  Historically, capital's share has been slightly less than 
one-third of the total payments.

    From 1948 to 1999, output per hour grew at an annual rate of 2.5 percent 
in private business (table B).  Of the 2.5 percent growth rate in labor 
productivity, 1.4 percent can be attributed to increases in multifactor 
productivity, 0.8 percent to the contribution of capital intensity, and 0.2 
percent to changes in labor composition.  The contribution of capital 
intensity is composed of the contribution of information processing equipment 
and software and of the contribution of other types of capital.  Information 
processing equipment and software is composed of computers and related 
equipment, communications equipment, instruments and photocopying equipment, 
and software. Investment in these forms of capital were small prior to 1979 
but has grown to nearly half of all investment in recent years. 

    From 1948 to 1973, multifactor productivity grew at an average annual rate 
of 2.1 percent in private business.  This rate, combined with the 1.0 percent 
contribution of capital intensity and the 0.2 percent contribution of labor 
composition, resulted in a labor productivity growth rate of 3.3 percent in 
private business.

    Table B and chart 2 show the post-1973 slowdown.  During 1973 to 1979, 
gains in multifactor productivity slowed to 0.6 percent per year in private 
business.  At the same time, the average annual contribution of capital 
intensity to labor productivity growth decreased to 0.7 percent, and labor 
composition made no contribution.  Labor productivity, therefore, increased 
1.3 percent per year from 1973 to 1979.

    Between 1979 and 1990, labor productivity increased 1.6 percent, slightly 
faster than the 1.3 percent growth in the 1973-79 period, but still a 
relatively slow rate of growth.  All of the faster labor productivity growth 
was the result of changes in the composition of the work force, which went 
from a 0.0 percent rate in 1973-79 to a 0.3 percent rate of growth for 
1979-90.  Information processing capital began to play an increasingly 
important role during this period.  These forms of capital contributed 0.5 
percent per year to labor productivity growth, or nearly three-quarters of 
the 0.8 percent growth in the contribution of all capital services. 

    From 1990 to 1995, labor productivity advanced at an annual rate of 1.5 
percent in the private business sector.   This was 0.1 percentage point less 
than in the 1979-90 period.   The slower rate of growth was due to the decline 
in the rate of growth of the contribution of capital services, from 0.8 
percent in 1979-90 to 0.5 percent in 1990-95. This lower rate of growth offset 
small increases in the rate of growth in multifactor productivity and in the 
contribution of labor composition for this period.  Information processing 
capital became increasingly important during the 1990-95 period.  During this 
period, information processing equipment contributed 0.4 percent per year to 
labor productivity growth, or 80 percent of the contribution of all capital. 


Table B.  Compound average annual rates of growth in output per hour of all 
persons and the contributions of capital intensity, labor composition, 
and multifactor productivity, by major sector, 1948 to 1999

(percent per year)


			  1948-99  1948-73  1973-79  1979-90  1990-95  1995-99
Private business1

Output per hour 
of all persons               2.5      3.3      1.3      1.6      1.5      2.6

Contribution of 
capital intensity2           0.8      1.0      0.7      0.8      0.5      1.0

  Contribution of 
  information processing 
  equipment and software3    0.3      0.1      0.3      0.5      0.4      0.9

  Contribution of all
  other capital services     0.5      0.8      0.5      0.3      0.1      0.1

Contribution of 
labor composition4           0.2      0.2      0.0      0.3      0.4      0.3

Multifactor productivity5    1.4      2.1      0.6      0.5      0.6      1.3


Private nonfarm business1

Output per hour 
of all persons               2.2      2.9      1.2      1.4      1.6      2.4

Contribution of 
capital intensity2           0.8      0.8      0.7      0.8      0.5      1.0

  Contribution of 
  information processing 
  equipment and software3    0.3      0.1      0.3      0.5      0.4      0.9
   
  Contribution of all
  other capital services     0.5      0.7      0.5      0.3      0.1      0.1

Contribution of 
labor composition4           0.2      0.2      0.0      0.3      0.4      0.3

Multifactor productivity5    1.2      1.9      0.4      0.3      0.6      1.1

  Contribution of R&D to
  multifactor productivity   0.2      0.2      0.1      0.2      0.2      0.2

1. Excludes government enterprises.
2. Growth rate in capital services per hour times capital's share of current 
   dollar costs.
3. Growth rate of information processing equipment and software times its 
   share of total costs.
4. Growth rate of labor composition (the growth rate of labor input less the 
   growth rate of the hours of all persons) times labor's share of current 
   dollar costs.
5. Output per unit of combined labor and capital inputs.

Note: The sum of multifactor productivity and the contributions 
may not equal labor productivity due to independent rounding.


    During 1995-99, output per hour grew 2.6 percent per year in private 
business, 1.1 percentage points faster than during the 1990-95 period.  Most 
of the larger growth can be attributed to faster multifactor productivity 
growth, which more than doubled from 0.6 percent to 1.3 percent per year.  
Larger contributions from information processing capital account for the 
remainder of the increase.  Continuing the trend in substitution of 
information processing equipment for other forms of capital, information 
capital accounted for 90 percent of the contribution of all capital.   

    The trends of the various measures in the private nonfarm business sector 
were similar to those in the private business sector in each period.  So, 
the pattern of productivity slowdowns after 1973 and recoveries after 1979 
seen in private business can also be seen in the private nonfarm business 
sector.


Contribution of research and development to multifactor productivity in private 
nonfarm business

    While multifactor productivity reflects many influences, technological 
change is one of the primary contributors.  For private nonfarm business, BLS 
also reports estimates of the impact on multifactor productivity growth from 
the effects of firms' spending for research and development (R&D) on all 
firms within the same industries. Because many people associate research and 
development spending and the resulting technological improvements with 
productivity, multifactor productivity has not been adjusted to exclude the 
effects of research and development.  The contribution of research and 
development averaged 0.2 percent per year for the entire 1948-99 period, or 
nearly 15 percent of total multifactor productivity growth (table B).  The 
contribution of research and development was 0.2 percent per year during the 
1948-73 period, slowing to 0.1 percent during the 1973-79 period and returning 
to 0.2 percent for the periods 1979-90, 1990-95, and 1995-99. 


Manufacturing 

    The multifactor productivity measures for manufacturing differ in several 
ways from those for private business and private nonfarm business in their 
treatment of labor input, output, and classes of factor inputs.  First, the 
manufacturing measure of labor input is a direct aggregate of hours.  This is 
in contrast to the major sector measures for which estimates of the effects of 
changing labor composition have been developed. 

    In addition, the output concept used for multifactor productivity in 
manufacturing is "sectoral output".  Sectoral output is similar to gross 
output, but excludes shipments from one manufacturing establishment to 
another.  The resulting multifactor productivity measure compares what is 
produced in the manufacturing sector for use outside of manufacturing with 
the inputs used in the manufacturing process obtained from outside of 
manufacturing.  The comparison excludes flows between manufacturing 
establishments from measures of both output and inputs. 

    Finally, multifactor productivity in manufacturing compares "sectoral 
output" to three classes of inputs: 1) hours at work of labor employed within 
manufacturing; 2) capital services employed by manufacturing establishments; 
and 3) purchases of energy, materials, and business services from outside of 
manufacturing (intermediates). 

   In manufacturing, intermediates are the largest input in terms of costs.  
Furthermore, research has shown that substitution among inputs, including 
intermediates, affects productivity change.  It is therefore important to 
include intermediates in productivity measures at the level of manufacturing.  
In contrast, the more aggregate productivity measures compare "value-added" 
output with two classes of inputs, capital and labor.  Because of these 
differences in methods, productivity change in manufacturing cannot be 
directly compared with changes in private business or private nonfarm 
business.  


Manufacturing productivity in 1999 and historical trends

    Multifactor productivity in manufacturing rose 0.7 percent in 1999 
(table C).  This was a marked downturn from the 2.6 percent gain in 1998 and 
was the lowest multifactor productivity growth in manufacturing since a 
decline in 1991.  

    In 1999, the 0.7 percent gain in multifactor productivity was the result 
of a 2.1 percent advance in sector output less a 1.4 percent increase in 
combined inputs.  Growth in both output and combined inputs were the slowest 
since declines in 1991. Energy input grew for a second year in a row, rising 
2.8 percent in 1999.  Inputs of materials rose 3.3 percent in 1999.  Capital 
services continued to accelerate, posting a 5.2 percent advance, the largest 
increase since 1974.  Hours declined for the second year in a row, declining 
0.8 percent, the largest decline in hours since 1991. 

    Multifactor productivity grew 1.2 percent annually from 1949 to 1999 
(when the manufacturing series started).  Sectoral output increased at a 3.3 
percent annual rate, and combined inputs rose 2.1 percent per year (table C).  
Unlike the private business and private nonfarm business sectors, the 
productivity slowdown in manufacturing was confined to the 1973-79 period.  
Multifactor productivity, which had been growing 1.5 percent annually prior to 
1973, fell 0.6 percent per year between 1973 and 1979.  Output growth slowed 
to 2.5 percent, while combined inputs grew 3.1 percent over the 1973-79 time 
period.

    Between 1979 and 1990, multifactor productivity growth in manufacturing 
rebounded sharply to 1.1 percent per year.  Sectoral output growth continued 
to slow, and, in this period, all input growth rates also fell.  Hours 
declined, and the growth rates for both capital services and materials fell 
sharply.  As a result, combined inputs grew less than 1 percent annually.  
The rebound in productivity was associated mainly with slower growth in 
combined inputs.

    From 1990 to 1995, multifactor productivity growth accelerated further, 
matching the pre-1973 growth rate.  Multifactor productivity advanced 1.5 
percent per year during this period.  Output growth increased to 3.5 percent 
per year, while combined inputs rose 2.0 percent annually.  The decline in 
hours slowed to 0.1 percent, and energy, materials, and purchased business 
services all grew much more rapidly than in the 1979-90 period.

    From 1995 to 1999, multifactor productivity advanced still faster at 1.9 
percent per year.  Sectoral output growth increased to 4.1 percent per year, 
while combined inputs continued to advance at about the same rate as in the 
early 1990s.  Hours increased slightly during the 1995-99 period, but the 
increase in the growth rate of capital services, to 4.4 percent, was most 
notable.  

    Among detailed manufacturing industries, durable goods manufacturers 
experienced considerably faster multifactor productivity gains than nondurable 
goods manufacturers (table 9).  While little difference existed prior to 1979, 
the productivity gap widened thereafter, primarily due to the rapid 
productivity growth in the two machinery industries; industrial and 
commercial machinery and electronic and other electrical equipment.  

Table C.  Productivity and related data in manufacturing, percent changes, 
1949-99

(percent per year)

			      1949-  1949-  1973-  1979-  1990-  1995-  1998-
			      1999   1973   1979   1990   1995   1999   1999
Productivity
 Multifactor productivity1     1.2    1.5   -0.6    1.1    1.5    1.9    0.7
 
   Output per hour
   of all persons              2.7    2.6    2.2    2.6    3.6    4.0    2.9

   Output per unit
   of capital services        -0.4    0.0   -2.1   -0.7    0.2   -0.3   -3.0

 Sectoral output               3.3    4.0    2.5    2.0    3.5    4.1    2.1

 Inputs
   Hours2                      0.6    1.4    0.3   -0.7   -0.1    0.1   -0.8
    Capital services           3.7    4.0    4.7    2.7    3.3    4.4    5.2
    Energy                     2.7    4.9    0.8    0.3    1.1    0.2    2.8
    Non-energy materials       3.0    2.3    6.2    1.7    4.2    4.8    3.3
    Purchased business 
    services                   3.8    5.1    5.4    1.7    2.1    0.3   -1.6
    Combined inputs3           2.1    2.4    3.1    0.8    2.0    2.2    1.4

1.  Output per unit of combined hours, capital, energy, materials and 
    purchased business services inputs.
2.  Hours at work of all persons.
3.  The growth rate of each input is weighted by its share of nominal costs.

 
    Over the 1949-99 period, multifactor productivity advanced most rapidly 
in electronic and other electrical equipment, textile mill products, and 
industrial machinery. The printing and publishing industry was the only 
industry to experience a multifactor productivity decline over the entire 
period.  In the more recent period of 1995-99, multifactor productivity in 
electronic and other electrical equipment advanced 7.2 percent per year and 
it rose 6.1 percent per year in industrial machinery.  Most information 
processing equipment is made within these two industries. 

Revisions

    The multifactor productivity data for 1998 and earlier years issued on 
Sept. 21, 2000, incorporated definition and classification changes in the 
National Income and Product Accounts (NIPAs).  The data issued today reflect 
a number of revisions to source data. 

    Private business and private nonfarm business output series reflect the 
annual revisions to the NIPAs, announced by the Bureau of Economic Analysis 
in August 2000.


    The hours data in this release incorporate the results of the 1999 Hours at 
Work survey.  This survey is designed to measure the ratio of hours at work 
to hours paid for production and nonsupervisory employees in nonagricultural 
establishments.  BLS converts hours paid from the Current Employment 
Statistics program to hours at work using data from this survey.  The results 
from the 1999 Hours at Work survey can be found at 
http://stats.bls.gov/lprlabor.htm or in print.

    Labor composition measures have been updated through 1999.  A brief 
description, entitled Changes in the Composition of Labor for the BLS 
Multifactor Productivity Measures, is available at 
http://stats.bls.gov/mprlabor.htm or in print.

    Small revisions to the manufacturing industry price indexes for 1993-99 
have been incorporated. 

    Comprehensive tables containing additional data beyond the scope of this 
press release are available upon request or at 
http://stats.bls.gov/mprdload.htm.
Summary of Methods

    The following note describes the major data sources and the procedures 
used in deriving BLS multifactor productivity indexes.  More detailed 
information on methods, limitations, and data sources is provided in BLS 
Bulletin 2178 (September 1983), "Trends in Multifactor Productivity, 
1948-81."  Methods for measuring manufacturing multifactor productivity 
are discussed in William Gullickson, "Measurement of productivity growth in 
U.S. manufacturing," in the July 1995 issue of the Monthly Labor Review.  
Additional data not contained in the release can be obtained in print or 
at http://stats.bls.gov/mprhome.htm.

    This release presents data for the private business, private nonfarm 
business, and manufacturing sectors.  The private business sector, which 
accounts for about 76 percent of gross domestic product, includes all of 
gross domestic product except the output of general government, government 
enterprises, non-profit institutions, the rental value of owner-occupied 
real estate, and the output of paid employees of private households.  
Additionally, the private nonfarm business sector excludes farms, but 
includes agricultural services.  Manufacturing sector output is measured as 
the value of all production delivered to non-manufacturing industries plus 
deliveries to final demand.  

    The private business, private nonfarm business, and manufacturing 
multifactor productivity measures describe the relationship between output in 
real terms and the inputs involved in its production.  They do not measure 
the specific contributions of labor, capital, or any other factor of 
production.  Rather, multifactor productivity is designed to measure the 
joint influences on economic growth of technological change, efficiency 
improvements, returns to scale, reallocation of resources due to shifts in 
factor inputs across industries, and other factors.

Private business and private nonfarm business 

    The multifactor productivity indexes for private business and private 
nonfarm business are derived by dividing an output index by an index of 
labor input and capital services.  The output indexes are computed as chained 
superlative indexes (Fisher Ideal indexes) of components of real output.  
For the years 1948 to 1999, the Bureau of Economic Analysis (BEA) supplies 
the output indexes.  BLS adjusts these to eliminate the output of government 
enterprises.

    Capital input measures the services derived from the stock of physical 
assets and software.  The assets included are fixed business equipment, 
structures, inventories, and land.  Among equipment, BLS provides additional 
detail for information processing equipment and software (IPES).  IPES is 
composed of four broad classes of assets: computers and related equipment, 
software, communications equipment, and other IPES equipment.  Computers and 
related equipment includes mainframe computers, personal computers, printers, 
video displays, and other related equipment.  Software is comprised of 
pre-packaged, custom, and own-account software.  Communications equipment is 
not further differentiated.  Other IPES includes scientific and related 
equipment, photocopying and related equipment, and office and accounting 
equipment.  Structures include nonresidential structures and residential 
capital that is rented out by profit-making firms or persons.  Financial 
assets are excluded, as are owner-occupied residential structures.  The 
aggregate capital measures are obtained by Tornqvist aggregation of the 
capital stocks for each asset type within each of 53 industries using 
estimated rental prices for each asset type.  Each rental price reflects the 
nominal rate of return to all assets within the industry and rates of 
economic depreciation and revaluation for the specific asset; rental prices 
are adjusted for the effects of taxes.  Data on investments in physical 
assets are obtained from BEA.  Current-dollar gross product originating (GPO) 
data, obtained from BEA, are used in estimating capital rental prices.  
This news release makes use of revised GPO data, released by BEA in 
December 2000.

    Labor input in private business and private nonfarm business is obtained 
by Tornqvist-aggregation of the hours worked by all persons, classified by 
education, work experience, and gender with weights determined by their 
shares of labor compensation.  Hours paid of employees are obtained from the 
Current Employment Statistics program.  The hours at work of proprietors, 
unpaid family workers, and farm employees are derived from the Current 
Population Survey.  The hours of employees are converted to an at-work basis 
by using the Hours at Work survey.  The growth rate of labor composition is 
defined as the difference between the growth rate of weighted labor input and 
the growth rate of the hours of all persons. Additional information 
concerning data sources and methods of measuring labor composition can be 
found in BLS Bulletin 2426 (December 1993), "Labor Composition and U.S. 
Productivity Growth, 1948-90."

    The labor and capital components of the input indexes are combined with 
(Tornqvist) weights that represent each component's share of total costs.  
Total costs are defined as the value of output (gross product originating) 
less a portion of indirect business taxes.  Most indirect taxes, such as 
excise taxes, are excluded from costs; however, property and motor vehicle 
taxes remain in total costs.  The index uses changing weights: The share in 
each year is averaged with the preceding year's share.

Manufacturing sector and manufacturing industries

    The manufacturing multifactor productivity index is derived by dividing an 
output index by an index of combined hours, capital services, energy, 
materials, and purchased business services.  The output index for total 
manufacturing is computed using a chained superlative index (Tornqvist) of 
4-digit SIC industry outputs.  Industry outputs are developed by BLS from 
data obtained from the Annual Survey of Manufactures (ASM) and the Census of 
Manufactures (CM) from the Bureau of the Census, U.S. Department of Commerce, 
together with Producer Price Indexes from BLS and price data from BEA.  

    Labor input in manufacturing is measured as the sum of hours at work of 
all persons.  The construction of hours at work follows the methods used in 
the private business sector described above, except that hours in 
manufacturing are directly aggregated and do not include the effects of 
changing labor composition. Capital inputs in manufacturing are measured 
using the same methods and data sources as capital services in private 
business. 

    Energy input is constructed using costs and quantity data from the ASM, 
the CM, and the Manufacturing Energy Consumption Survey of the Energy 
Information Administration, U.S. Department of Energy, together with BLS 
Producer Price Indexes.  The series on non-energy materials input also relies 
on ASM and CM data.  Indexes of purchased business services are developed by 
BLS using input-output tables to estimate the proportion of costs attributed 
to nine types of services.  Tornqvist indexes of each of these three input 
classes are developed at the 2-digit SIC level and then aggregated to total 
manufacturing.  As with the sectoral output measures, materials and energy 
inputs are adjusted to exclude transactions between establishments within 
the same sector.

     The five input indexes (capital services, hours, energy, materials, and 
purchased business services) are combined using Tornqvist aggregation, 
employing weights that represent each component's share of total costs.  
Total costs are defined as the value of manufacturing sectoral output.  
The index uses changing weights: The share in each year is averaged with 
the preceding year's share.

Research and development

     The stock of research and development in private nonfarm business is 
derived by cumulating constant dollar measures of research and development 
expenditures and allowing for depreciation.  Current dollar expenditures for 
privately-financed research and development for the years 1953-99 are 
obtained from annual issues of Research and Development in Industry published 
by the National Science Foundation.  BLS develops price deflators and 
estimates of the rate of depreciation.  Further description of these data and 
methods can be found in BLS Bulletin 2331 (September 1989), "The Impact of 
Research and Development on Productivity Growth."


Table 1.  Private business sector: Productivity and related measures, 1948-991

Indexes 1996=100

      Output                                            Combined
      per     Output    Multi-                          units of  Capital
      hour    per       factor                 Capital  capital   services     
      of all  unit of   Product-  Out-  Labor  Serv-    and       per hour of
Year  persons capital   ivity2    put3  Input4 ices5    labor6    all persons 
               
1948   31.1    107.8     51.5    18.6    51.1   17.3     36.2        28.8
1949   32.2    104.8     52.1    18.6    49.4   17.7     35.6        30.7

1950   35.0    111.0     55.9    20.5    50.3   18.4     36.6        31.5

1955   40.9    114.7     61.9    24.9    53.7   21.7     40.3        35.6

1960   45.6    111.1     65.3    27.5    54.0   24.8     42.2        41.1

1965   55.9    122.4     76.4    35.6    58.0   29.1     46.7        45.7
1966   58.2    123.7     78.7    38.1    59.5   30.8     48.3        47.0
1967   59.5    119.0     78.8    38.8    59.4   32.6     49.2        50.0
1968   61.4    119.8     80.9    40.7    60.3   34.0     50.4        51.2
1969   61.7    117.5     80.4    42.0    62.1   35.7     52.2        52.5

1970   63.0    112.3     80.3    42.0    61.0   37.4     52.3        56.1
1971   65.8    112.0     82.8    43.6    60.5   38.9     52.7        58.8
1972   68.0    114.6     85.3    46.5    62.6   40.6     54.6        59.3
1973   70.2    116.1     87.6    49.8    64.8   42.9     56.9        60.4
1974   69.0    108.4     84.4    49.0    65.2   45.2     58.1        63.6

1975   71.5    103.4     85.2    48.5    62.4   46.9     57.0        69.1
1976   74.1    107.1     88.4    51.9    64.2   48.4     58.7        69.1
1977   75.2    108.9     89.8    54.8    66.8   50.3     61.0        69.1
1978   76.1    110.9     91.0    58.2    70.2   52.5     64.0        68.6
1979   76.0    109.1     90.6    60.2    72.4   55.1     66.4        69.6

1980   75.8    102.7     88.6    59.4    71.9   57.9     67.1        73.8
1981   77.3    100.5     88.8    61.0    73.0   60.8     68.8        76.9
1982   77.2     93.6     86.1    59.3    71.7   63.3     68.9        82.4
1983   79.9     95.7     88.5    62.5    73.4   65.3     70.6        83.4
1984   82.2     99.7     91.4    68.1    77.7   68.3     74.5        82.4

1985   83.9     99.2     92.4    71.0    79.6   71.5     76.9        84.6
1986   86.5     98.8     93.8    73.6    80.5   74.6     78.5        87.6
1987   87.0     98.9     94.1    76.3    83.1   77.1     81.1        88.0
1988   88.1    100.2     94.7    79.6    86.3   79.4     84.0        87.9
1989   89.0    100.8     95.3    82.4    88.9   81.8     86.5        88.3

1990   90.2     99.5     95.4    83.6    89.4   84.0     87.6        90.6
1991   91.3     96.3     94.5    82.6    88.3   85.8     87.5        94.8
1992   94.8     97.8     96.6    85.7    89.3   87.6     88.7        96.9
1993   95.4     98.6     97.1    88.5    91.8   89.8     91.1        96.7
1994   96.6    100.3     98.1    92.8    95.6   92.5     94.6        96.3

1995   97.3     99.7     98.4    95.8    98.0   96.0     97.3        97.6
1996  100.0    100.0    100.0   100.0   100.0  100.0    100.0       100.0
1997  102.2    100.3    101.2   105.2   103.5  104.9    104.0       101.9
1998  105.1     99.6    102.6   110.6   106.1  111.0    107.7       105.5
1999  107.9     98.1    103.5   115.8   108.9  118.1    111.9       110.0
                                       
See footnotes following table 6.                                                                                                             Source: Bureau of Labor Statistics
Table 2.  Private nonfarm business sector: Productivity and related measures, 1948-991

Indexes 1996=100

         Productivity                         Inputs          
               
      Output                                            Combined
      per     Output    Multi-                          units of  Capital
      hour    per       factor                 Capital  capital   services     
      of all  unit of   Product-  Out-  Labor  Serv-    and       per hour of
Year  persons capital   ivity2    put3  Input4 ices5    labor6    all persons 

1948   35.1    117.4     56.3     18.0   44.1   15.3      31.9       29.9
1949   36.7    114.3     57.4     17.9   42.2   15.7      31.2       32.1

1950   39.1    120.7     60.9     19.7   43.7   16.4      32.4       32.4

1955   44.6    125.3     66.3     24.4   48.6   19.5      36.8       35.6

1960   48.7    120.8     69.2     27.2   50.1   22.5      39.3       40.3

1965   58.6    132.0     79.8     35.5   55.4   26.9      44.4       44.4
1966   60.7    133.4     82.1     38.0   57.2   28.5      46.3       45.5
1967   61.8    127.8     82.0     38.7   57.1   30.3      47.1       48.3
1968   63.8    128.6     84.2     40.8   58.2   31.7      48.4       49.6
1969   63.8    125.7     83.4     42.0   60.1   33.4      50.3       50.8

1970   64.9    119.6     82.9     41.9   59.3   35.1      50.6       54.3
1971   67.6    118.9     85.4     43.6   58.9   36.6      51.0       56.9
1972   69.9    121.5     88.0     46.6   60.9   38.4      52.9       57.6
1973   72.1    123.2     90.4     50.0   63.3   40.6      55.3       58.6
1974   71.0    114.7     87.2     49.2   63.7   42.9      56.4       61.9

1975   73.0    108.2     87.4     48.4   60.9   44.7      55.3       67.4
1976   75.8    112.4     90.9     51.9   62.8   46.2      57.1       67.4
1977   76.9    114.0     92.2     54.9   65.4   48.1      59.5       67.4
1978   77.8    116.1     93.5     58.4   68.8   50.3      62.5       67.0
1979   77.5    113.9     92.9     60.3   71.1   52.9      64.9       68.1

1980   77.3    106.9     90.8     59.6   70.7   55.7      65.6       72.3
1981   78.3    103.6     90.3     60.8   71.8   58.7      67.4       75.6
1982   78.0     96.1     87.3     59.0   70.6   61.4      67.5       81.2
1983   81.4     98.7     90.5     62.8   72.3   63.6      69.4       82.4
1984   83.2    102.3     92.9     68.1   76.7   66.6      73.3       81.4

1985   84.4    101.1     93.3     70.8   78.8   70.0      75.9       83.5
1986   87.1    100.4     94.7     73.5   79.8   73.2      77.6       86.7
1987   87.5    100.2     94.8     76.2   82.5   76.0      80.4       87.3
1988   88.6    101.5     95.5     79.7   85.9   78.5      83.5       87.3
1989   89.3    101.8     95.8     82.4   88.5   81.0      86.0       87.7

1990   90.3    100.3     95.7     83.5   89.2   83.3      87.3       90.0
1991   91.4     96.8     94.8     82.5   88.0   85.2      87.1       94.4
1992   94.8     98.1     96.7     85.5   89.0   87.1      88.4       96.6
1993   95.3     98.9     97.2     88.4   91.8   89.4      91.0       96.4
1994   96.5    100.4     98.1     92.6   95.4   92.3      94.4       96.2

1995   97.5     99.9     98.6     95.8   97.8   95.9      97.2       97.6
1996  100.0    100.0    100.0    100.0  100.0  100.0     100.0      100.0
1997  102.0    100.0    101.0    105.1  103.6  105.1     104.1      101.9
1998  104.7     99.3    102.4    110.6  106.4  111.3     108.0      105.5
1999  107.3     97.6    103.0    115.8  109.5  118.7     112.4      110.0

See footnotes following table 6.                                                                                                             Source: Bureau of Labor Statistics
Table 3.  Manufacturing sector: Productivity and related measures, 1949-99

Indexes 1996=100

         Productivity                             Inputs
               
     Output   Output                                              Purchased Comb-
     per      per    Multi-   Sect-                               Busi-     inded
     hour     unit   factor   oral         Capital                ness      units
     of all   of     Product- Out-    Hours Serv-          Mater- serv-     of all
Year person  capital ivity7   put8      9   ices5   Energy ials   ices      inputs10  
                                                                         
1949  29.7    120.4   59.7    22.7    76.3   18.8    27.0   25.9   15.5       38.0

1950  30.1    127.7   62.8    24.9    82.5   19.5    28.3   25.5   18.1       39.6

1955  34.4    129.6   66.9    31.4    91.2   24.2    39.4   31.5   23.3       46.9

1960  37.1    118.8   68.3    32.9    88.8   27.7    48.0   32.1   25.9       48.2

1965  43.1    130.6   77.7    42.3    98.3   32.4    62.6   34.7   34.1       54.5
1966  43.5    130.8   78.0    45.6   104.7   34.8    67.1   36.9   38.5       58.4
1967  45.1    124.6   77.5    47.0   104.1   37.7    72.3   38.6   43.6       60.6
1968  46.7    124.9   79.9    49.3   105.6   39.5    76.9   39.0   43.5       61.7
1969  47.5    122.0   80.5    50.8   106.8   41.6    79.6   39.0   46.2       63.1

1970  48.1    111.5   79.2    48.3   100.5   43.4    79.8   37.7   44.6       61.0
1971  51.3    111.3   81.4    49.7    96.9   44.6    81.0   40.2   44.1       61.0
1972  53.4    117.5   84.4    54.1   101.3   46.1    83.2   43.2   47.1       64.2
1973  54.4    119.7   85.9    58.0   106.5   48.5    85.8   45.0   51.3       67.5
1974  54.3    110.2   81.3    56.5   104.1   51.3    88.2   49.2   54.9       69.6

1975  57.0     99.2   78.9    53.4    93.8   53.9    82.1   51.8   53.1       67.7
1976  59.3    104.2   81.7    58.3    98.3   56.0    85.2   56.2   54.4       71.4
1977  61.8    108.1   82.9    63.2   102.3   58.5    85.3   63.2   58.9       76.3
1978  62.4    109.1   83.5    66.5   106.6   61.0    86.4   66.1   62.3       79.6
1979  61.9    105.6   82.7    67.3   108.7   63.7    90.0   64.7   70.1       81.3

1980  62.1     96.5   81.3    64.4   103.7   66.7    86.4   63.0   67.2       79.2
1981  62.8     92.6   81.9    64.7   102.9   69.8    86.1   62.5   65.0       79.0
1982  66.1     86.5   83.3    62.1    94.0   71.9    77.8   60.9   56.3       74.6
1983  68.1     89.5   85.2    64.9    95.3   72.5    78.7   61.3   63.4       76.2
1984  70.5     96.1   87.8    71.5   101.5   74.5    83.7   67.6   67.4       81.5

1985  73.0     95.6   89.2    73.6   100.8   76.9    81.0   71.9   62.9       82.5
1986  76.2     95.9   90.7    75.7    99.3   78.9    81.7   73.5   67.0       83.5
1987  78.4     97.2   93.5    78.3    99.9   80.6    86.8   70.7   71.3       83.8
1988  80.0    100.2   95.2    82.2   102.8   82.0    90.2   72.0   77.7       86.4
1989  80.0     98.9   93.4    82.6   103.2   83.6    90.5   75.1   82.7       88.4

1990  82.3     97.2   93.3    83.2   101.1   85.6    93.4   77.6   84.7       89.2
1991  84.2     93.3   92.4    81.6    96.8   87.4    93.5   78.6   84.4       88.3
1992  88.7     95.7   94.0    85.5    96.4   89.3    93.4   83.9   91.7       91.0
1993  90.3     96.8   94.9    88.3    97.8   91.3    96.9   86.9   94.2       93.1
1994  93.1     99.6   97.3    93.0    99.9   93.3   100.2   90.3   96.2       95.6

1995  96.6    100.5   99.2    97.0   100.3   96.4   102.3   92.9  100.5       97.7
1996 100.0    100.0  100.0   100.0   100.0  100.0   100.0  100.0  100.0      100.0
1997 104.3    101.8  103.5   106.1   101.7  104.2    97.0  101.5  104.8      102.5
1998 109.9    102.3  106.3   111.5   101.4  109.0   100.3  108.7  103.4      104.9
1999 113.1     99.3  107.0   113.8   100.6  114.6   103.2  112.3  101.8      106.4

See footnotes following table 6.                                                                                                             Source: Bureau of Labor Statistics
Table 4.  Private business sector: Productivity and related measures, 1948-99

Percent Change

      Output                                            Combined
      per     Output    Multi-                          units of  Capital
      hour    per       factor                 Capital  capital   services     
      of all  unit of   Product-  Out-  Labor  Serv-    and       per hour of
Year  persons capital   ivity2    put3  Input4 ices5    labor6    all persons 

1949   3.5     -2.8      1.2      -0.2   -3.3   2.7      -1.4        6.5     

1950   8.8      5.9      7.3      10.1    2.0   3.9       2.6        2.7

1955   4.6      5.1      4.7       8.5    3.9   3.2       3.7       -0.4

1960   1.9     -1.1      0.6       1.8    0.5   2.9       1.3        3.0

1965   3.6      2.3      3.2       7.0    3.2   4.7       3.7        1.3
1966   4.1      1.1      3.1       6.8    2.6   5.7       3.6        3.0
1967   2.2     -3.8      0.1       1.9   -0.2   5.9       1.7        6.3
1968   3.2      0.7      2.6       5.1    1.6   4.4       2.5        2.5
1969   0.5     -1.9     -0.5       3.0    2.9   5.0       3.6        2.4

1970   2.2     -4.5     -0.2       0.0   -1.7   4.6       0.2        6.9
1971   4.4     -0.3      3.2       3.9   -0.8   4.2       0.7        4.7
1972   3.3      2.3      2.9       6.7    3.4   4.3       3.7        0.9
1973   3.2      1.3      2.8       7.0    3.5   5.6       4.2        1.9
1974  -1.6     -6.6     -3.6      -1.6    0.7   5.3       2.1        5.3

1975   3.5     -4.6      0.9      -1.0   -4.4   3.8      -1.9        8.6
1976   3.7      3.6      3.8       6.9    2.9   3.2       3.0        0.1
1977   1.6      1.7      1.6       5.7    4.0   3.9       4.0       -0.1
1978   1.1      1.8      1.2       6.2    5.2   4.3       4.9       -0.7
1979  -0.1     -1.6     -0.3       3.3    3.1   5.0       3.7        1.5

1980  -0.3     -5.9     -2.3      -1.2   -0.6   5.0       1.1        6.0
1981   2.0     -2.2      0.2       2.7    1.5   5.0       2.6        4.3
1982  -0.2     -6.8     -3.0      -2.9   -1.7   4.2       0.1        7.1
1983   3.5      2.3      2.8       5.4    2.3   3.1       2.5        1.2
1984   2.9      4.2      3.3       8.9    6.0   4.6       5.5       -1.2

1985   2.1     -0.5      1.1       4.3    2.4   4.8       3.1        2.6
1986   3.1     -0.5      1.6       3.7    1.1   4.3       2.1        3.6
1987   0.6      0.2      0.3       3.6    3.2   3.4       3.3        0.4
1988   1.2      1.3      0.7       4.3    3.9   3.0       3.6       -0.1
1989   1.0      0.6      0.6       3.5    2.9   2.9       2.9        0.5

1990   1.3     -1.2      0.2       1.5    0.6   2.7       1.3        2.6
1991   1.2     -3.3     -1.0      -1.1   -1.2   2.2      -0.1        4.6
1992   3.8      1.6      2.3       3.7    1.1   2.1       1.4        2.2
1993   0.6      0.8      0.5       3.2    2.8   2.5       2.7       -0.2
1994   1.3      1.8      1.1       4.9    4.1   3.1       3.8       -0.5

1995   0.8     -0.6      0.3       3.2    2.5   3.8       2.9        1.3
1996   2.8      0.3      1.6       4.4    2.1   4.2       2.8        2.5
1997   2.2      0.3      1.2       5.2    3.5   4.9       4.0        1.9
1998   2.8     -0.7      1.4       5.1    2.5   5.8       3.6        3.5
1999   2.7     -1.6      0.8       4.8    2.7   6.4       3.9        4.3

See footnotes following table 6.                                                                                                             Source: Bureau of Labor Statistics
Table 5.  Private nonfarm business sector: Productivity and related measures, 1948-99

Percent Change

         Productivity                         Inputs          
               
      Output                                            Combined
      per     Output    Multi-                          units of  Capital
      hour    per       factor                 Capital  capital   services     
      of all  unit of   Product-  Out-  Labor  Serv-    and       per hour of
Year  persons capital   ivity2    put3  Input4 ices5    labor6    all persons 

1949   4.5     -2.6      2.0       0.0   -4.2   2.7      -2.0        7.3

1950   6.7      5.6      6.0      10.0    3.6   4.2       3.8        1.0

1955   4.7      5.1      4.7       8.9    4.2   3.6       4.0       -0.4

1960   1.3     -1.3      0.5       1.7    0.4   3.1       1.2        2.7

1965   3.1      2.0      2.8       7.1    3.7   5.0       4.1        1.1
1966   3.5      1.1      2.9       7.2    3.3   6.1       4.2        2.5
1967   1.8     -4.2     -0.1       1.7   -0.2   6.2       1.8        6.3
1968   3.2      0.7      2.6       5.4    1.8   4.7       2.7        2.5
1969   0.1     -2.3     -0.9       3.0    3.3   5.4       3.9        2.5

1970   1.6     -4.9     -0.6      -0.1   -1.3   5.0       0.5        6.8
1971   4.2     -0.5      3.0       3.9   -0.7   4.4       0.8        4.8
1972   3.4      2.1      3.0       7.0    3.4   4.7       3.8        1.2
1973   3.2      1.4      2.8       7.4    3.9   5.9       4.5        1.8
1974  -1.5     -6.9     -3.6      -1.6    0.6   5.7       2.1        5.7

1975   2.8     -5.6      0.2      -1.8   -4.4   4.1      -2.0        8.9
1976   3.8      3.8      4.1       7.4    3.1   3.4       3.2        0.0
1977   1.5      1.5      1.4       5.7    4.2   4.1       4.2        0.0
1978   1.3      1.8      1.4       6.5    5.2   4.6       5.0       -0.5
1979  -0.4     -1.9     -0.7       3.2    3.3   5.2       3.9        1.5

1980  -0.3     -6.1     -2.3      -1.2   -0.5   5.3       1.1        6.2
1981   1.3     -3.1     -0.5       2.1    1.5   5.4       2.6        4.6
1982  -0.4     -7.3     -3.3      -3.1   -1.6   4.5       0.2        7.4
1983   4.4      2.8      3.6       6.5    2.4   3.6       2.7        1.5
1984   2.3      3.6      2.6       8.5    6.2   4.8       5.7       -1.3

1985   1.4     -1.1      0.5       3.9    2.7   5.1       3.5        2.6
1986   3.1     -0.7      1.5       3.9    1.3   4.6       2.3        3.8
1987   0.4     -0.2      0.1       3.6    3.4   3.8       3.5        0.6
1988   1.3      1.3      0.7       4.6    4.1   3.3       3.9        0.0
1989   0.8      0.2      0.3       3.4    3.0   3.1       3.1        0.5

1990   1.2     -1.5      0.0       1.4    0.8   2.9       1.4        2.6
1991   1.3     -3.4     -1.0      -1.2   -1.4   2.3      -0.2        4.9
1992   3.6      1.3      2.0       3.6    1.2   2.2       1.5        2.3
1993   0.6      0.8      0.5       3.5    3.1   2.6       3.0       -0.2
1994   1.3      1.5      1.0       4.7    3.9   3.2       3.7       -0.2

1995   1.0     -0.4      0.5       3.4    2.5   3.9       3.0        1.5
1996   2.5      0.1      1.4       4.4    2.3   4.3       2.9        2.5
1997   2.0      0.0      1.0       5.1    3.6   5.1       4.1        1.9
1998   2.7     -0.7      1.4       5.2    2.6   6.0       3.7        3.5
1999   2.5     -1.8      0.6       4.7    2.9   6.6       4.1        4.3

See footnotes following table 6.                                                                                                             Source: Bureau of Labor Statistics
Table 6.  Manufacturing sector: Productivity and related measures, 1950-99

Percent Change

         Productivity                             Inputs
               
     Output   Output                                              Purchased Comb-
     per      per    Multi-   Sect-                               Busi-     inded
     hour     unit   factor   oral         Capital                ness      units
     of all   of     Product- Out-    Hours Serv-          Mater- serv-     of all
Year person  capital ivity7   put8      9   ices5   Energy ials   ices      inputs10  
                                                                         
1950   1.5      6.1    5.2     9.7     8.1    3.4     4.7   -1.4   16.8        4.3

1955   4.0      5.7    3.0     9.7     5.5    3.8    13.9    8.3   11.3        6.6

1960   2.2     -0.7    0.2     1.7    -0.4    2.4     1.9    4.2    1.6        1.5

1965   2.3      3.0    2.6     8.3     5.9    5.2     5.7    4.9    6.9        5.6
1966   1.1      0.2    0.4     7.7     6.5    7.4     7.3    6.3   12.9        7.2
1967   3.7     -4.8   -0.6     3.1    -0.6    8.2     7.8    4.5   13.4        3.7
1968   3.6      0.3    3.1     5.1     1.4    4.8     6.3    1.2   -0.2        1.9
1969   1.7     -2.3    0.8     2.9     1.2    5.3     3.5   -0.2    6.1        2.1
                                                           
1970   1.2     -8.7   -1.6    -4.8    -5.9    4.2     0.3   -3.3   -3.4       -3.3
1971   6.7     -0.1    2.8     2.9    -3.6    3.0     1.5    6.7   -1.1        0.1
1972   4.1      5.6    3.6     8.9     4.6    3.2     2.7    7.3    6.7        5.1
1973   1.9      1.8    1.8     7.1     5.1    5.2     3.2    4.4    9.0        5.3
1974  -0.3     -7.9   -5.4    -2.5    -2.3    5.8     2.8    9.2    7.1        3.0

1975   4.9    -10.0    -2.9   -5.4    -9.9    5.1    -6.9    5.3   -3.3       -2.7
1976   4.2      5.0     3.5    9.2     4.8    3.9     3.8    8.4    2.4        5.4
1977   4.1      3.7     1.5    8.4     4.1    4.5     0.1   12.5    8.3        6.8
1978   1.0      0.9     0.8    5.2     4.2    4.3     1.2    4.6    5.7        4.4
1979  -0.8     -3.2    -1.0    1.1     1.9    4.5     4.2   -2.2   12.6        2.1
                                                            
1980   0.4     -8.6    -1.7   -4.2    -4.6    4.7    -4.0    -2.5  -4.1       -2.6
1981   1.1     -4.1     0.7    0.4    -0.7    4.6    -0.4    -0.9  -3.4       -0.3
1982   5.2     -6.6     1.8   -3.9    -8.7    2.9    -9.6    -2.6 -13.3       -5.6
1983   3.0      3.5     2.2    4.4     1.4    0.9     1.1     0.7  12.6        2.1
1984   3.5      7.4     3.1   10.3     6.5    2.7     6.4    10.3   6.2        7.0
                                                    
1985   3.6     -0.5     1.5    2.8    -0.8    3.3    -3.3     6.3  -6.6        1.3
1986   4.3      0.2     1.7    2.8    -1.4    2.6     0.8     2.3   6.5        1.2
1987   2.9      1.4     3.2    3.6     0.6    2.1     6.2    -3.8   6.4        0.4
1988   2.0      3.1     1.8    4.9     2.8    1.7     4.0     1.8   9.0        3.1
1989   0.1     -1.4    -1.8    0.5     0.5    1.9     0.2     4.3   6.4        2.4

1990   2.9     -1.7    -0.2    0.7    -2.1    2.4     3.2     3.3   2.5        0.9
1991   2.3     -4.0    -1.0   -2.0    -4.2    2.1     0.2     1.3  -0.4       -1.0
1992   5.3      2.6     1.7    4.8    -0.4    2.2    -0.1     6.8   8.6        3.1
1993   1.9      1.1     1.0    3.3     1.4    2.2     3.7     3.5   2.7        2.3
1994   3.0      2.9     2.5    5.3     2.2    2.3     3.4     3.9   2.2        2.7

1995   3.8      0.9     2.0    4.3     0.4    3.3     2.1     3.0   4.5        2.2
1996   3.5     -0.5     0.8    3.1    -0.3    3.7    -2.3     7.6  -0.5        2.4
1997   4.3      1.8     3.5    6.1     1.7    4.2    -3.0     1.5   4.8        2.5
1998   5.4      0.5     2.6    5.1    -0.3    4.6     3.4     7.1  -1.3        2.4
1999   2.9     -3.0     0.7    2.1    -0.8    5.2     2.8     3.3  -1.6        1.4

See footnotes following table 6.                                                                                                                                                            Source: Bureau of Labor Statistics
                        Footnotes, Tables 1-6

Source:  Output data are from the Bureau of Economic Analysis (BEA), 
U.S. Department of Commerce, and modified by the Bureau of Labor 
Statistics (BLS), U.S. Department of Labor.  Compensation and hours data are 
from BLS.  Capital measures are based on data supplied by BEA and the U.S. 
Department of Agriculture.  See also Summary of Methods in this release.

(1) The private business sector includes all of gross domestic product except 
    the output of general government, government enterprises, non-profit 
    institutions, the rental value of owner-occupied real estate, and the 
    output of paid employees of private households. The private nonfarm 
    business sector also excludes farms but includes agricultural services.

(2) Output per unit of combined labor and capital inputs.

(3) Gross domestic product originating in the sector, 
    superlative chained index.

(4) Index of the hours at work of all persons including employees, 
    proprietors, and unpaid family workers classified by education, work 
    experience, and gender.  This superlative chain index is computed by 
    combining changes in the hours of each education, experience, 
    and gender group weighted by each group's share of labor compensation. 

(5) A measure of the flow of capital services used in the sector.

(6) Labor input combined with capital input, using labor's and capital's 
    shares of costs as weights to form a superlative chained index. 

(7) Sectoral output per combined units of capital, hours, energy, 
    non-energy materials, and purchased business services.

(8) Manufacturing gross output excluding transactions between manufacturing
    establishments, superlative chained index.

(9) Hours at work of all persons.

(10) Combined units of capital services, hours, energy, non-energy materials, and 
     purchased business services, superlative chained index.
Table 7. Real capital input by asset type, private business, 1948-99

Average annual growth rates (percent)



                        1948-   1948-   1973-   1979-   1990-   1995-   1998-
                        1999    1973    1979    1990    1995    1999    1999
All Assets               3.8     3.7     4.3     3.9     2.7     5.3     6.4
  
  Equipment              5.9     5.5     6.9     5.6     4.4     9.4    11.6
    
    All Information     11.6     9.8    13.3    14.2     8.5     17.5   21.7
    equipment &
    Software

      Computers &       28.2     25.3   35.8    32.1     14.6    42.8   48.6
      related equipment

      Software          21.4     28.2   13.2    16.1     13.4    17.9   23.3
      Communications     8.6     10.0    7.9     8.2      4.1     7.6    9.6
      equipment

      Other IPES         6.5      6.8   11.0     5.9      3.2     3.5    3.7

    All other equipment  3.8      4.8    5.1     1.8      1.0     4.0    4.8

  Structures             3.0      3.2    3.0     3.6      1.8     2.2    2.3

  Residential rental     2.2      2.8    2.6     1.9      0.6     1.3    1.3
  capital

  Inventories            3.5      4.2    3.5     2.2      2.6     4.2    3.9
  
  Land                   2.0      2.0    2.3     2.6      0.9     1.2    1.5

Source: Bureau of Labor Statistics 

Note: For a brief discussion of methods used in preparing these data, 
see Summary of Methods in this release.
Table 8. Real capital input by asset type, private nonfarm business, 1948-99

Average annual growth rates (percent)

                        1948-   1948-   1973-   1979-   1990-   1995-   1998-
                        1999    1973    1979    1990    1995    1999    1999
All Assets               4.1     4.0     4.5     4.2     2.9     5.5     6.6
  
  Equipment              6.0     5.6     7.0     5.9     4.6     9.5    11.8
    
    All Information     11.6     9.8    13.3    14.2     8.5    17.5    21.8
    equipment & software

      Computers &       28.2    25.3    35.8    32.1    14.6    42.8    48.6
      related equipment

      Software          21.4    28.2    13.2    16.0    13.3    17.9    23.3

      Communications     8.6    10.0     7.9     8.2     4.1     7.6     9.6
      equipment

      Other IPES         6.5     6.8    11.0     5.9     3.2     3.5     3.7
    
    All other equipment  3.9     4.8     5.1     2.0     1.2     4.1     4.9
  
  Structures             3.1     3.3     3.0     3.7     1.9     2.2     2.4
  
  Residential rental     2.3     2.8     2.6     1.9     0.6     1.3     1.3
  capital

  Inventories            3.7     4.4     3.7     2.4     2.6     4.2     4.0
  
  Land                   2.7     2.8     3.3     3.5     1.1     1.4     1.8

Source: Bureau of Labor Statistics 

Note: For a brief discussion of methods used in preparing these data, 
see Summary of Methods in this release.
Table 9.  Manufacturing industries: Multifactor productivity trends, 1949-99 


Average annual growth rates

                            1948-   1948-   1973-   1979-   1990-   1995-   1998-
Industry                    1999    1973    1979    1990    1995    1999    1999

Manufacturing                1.2     1.5    -0.6     1.1     1.2     1.9     0.7

Nondurable manufacturing     0.7     1.3    -0.6     0.3     0.4     0.1    -1.3
Food and kindred products    0.5     0.7     0.1     0.4     0.7    -0.5     1.4
Tobacco manufactures         N.A.    N.A.    N.A.    N.A.    N.A.    N.A.    N.A.
Textile mill products        2.3     2.3     3.3     2.1     1.7     1.6     3.7
Apparel & related products   0.9     0.7     1.9     0.6     0.5     1.5     1.2
Paper and allied products    0.7     1.6    -1.2     0.0     0.2     1.0     0.2

Printing and publishing     -0.3     0.5    -0.7    -0.9    -1.2    -1.7    -4.5
Chemicals & allied products  1.1     2.5    -2.6     0.7    -0.2     0.5    -2.6
Petroleum refining           0.4     0.8    -0.6    -0.1     0.3     0.7    -1.1
Rubber & misc. 
  plastic products           0.7     0.9    -1.9     1.4     1.2     1.1    -0.6
Leather & leather products   N.A.    N.A.    N.A.    N.A.    N.A.    N.A.    N.A.
                                                             
Durable manufacturing        1.5     1.5    -0.6     1.8     2.0     3.3     2.4
Lumber and wood products     1.1     1.7     0.5     2.5    -1.7    -1.3    -0.7
Furniture and fixtures       0.6     0.6     0.4     0.6     0.7     1.0     0.0
Stone, clay, glass 
  & concrete products        0.8     1.1    -1.3     1.4     0.7     0.6    -1.0
Primary metals industries    0.2     0.4    -2.3     0.3     0.7     1.8     3.0
Fabricated metals products   0.3     0.5    -1.0     0.5     0.9    -0.4    -2.0

Industrial & 
  commercial machinery       1.8     0.7     0.1     3.2     3.1     6.1     4.4
Electronic & other 
  electrical equipment       2.9     2.1     1.0     3.1     5.8     7.2     8.7
Transportation equipment     0.8     1.5    -0.6     0.1     0.5     1.0    -0.3
Instruments                  1.3     1.8     1.2     1.4     0.1     0.4     0.3
Miscellaneous manufacturing  0.8     1.5    -1.1     1.1    -0.3     0.4     0.9

N.A. - Multifactor productivity measures are not published because of the 
       small size of the industry and data limitations.  This industry is 
       included in the aggregate for total manufacturing.

Note:  Multifactor productivity measures by industry are not directly 
       comparable to measures for aggregate manufacturing because industry 
       measures exclude transactions only within the specific industry while 
       the aggregate manufacturing measures also exclude transactions 
       between all manufacturing industries.