6

                                      
USDL 02-508
TRANSMISSION OF THIS
MATERIAL IS EMBARGOED
UNTIL 8:30 A.M. EDT,
THURSDAY, SEPTEMBER 5, 2002.

Internet address:      http://www.bls.gov/lpc/
Historical, technical  
  information:         (202) 691-5606
Current data:          (202) 691-5200
Media contact:         (202) 691-5902


                           PRODUCTIVITY AND COSTS
                             Second Quarter 2002


     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 2002.  The seasonally adjusted annual
rates of productivity change in the second quarter were:

               1.7 percent in the business sector and
               1.5 percent in the nonfarm business sector.

In both sectors, increases in productivity were larger than reported on
Aug. 9, due primarily to upward revisions to output.  (See table C.)

     In manufacturing, the revised productivity changes in the second quarter
were:

               4.3 percent in manufacturing,
               6.0 percent in durable goods manufacturing, and
               2.6 percent in nondurable goods manufacturing.

     In total manufacturing, the change in productivity was revised to show
an increase of 4.3 percent in the second quarter, compared with the
preliminary estimate of 4.9 percent.  Output and hours in manufacturing,
which includes about 16 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 Aug. 9
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 2002 measures
(Seasonally adjusted annual rates)
-------------------------------------------------------------------------                                                                  
                                                        Real      
                                              Hourly    hourly    Unit
                   Produc-                    compen-   compen-   labor
Sector             tivity    Output   Hours   sation    sation    costs
-------------------------------------------------------------------------
                      Percent change from preceding quarter

Business            1.7       0.5      -1.2    4.0       0.5       2.3
Nonfarm business    1.5       0.8      -0.7    3.7       0.2       2.1
Manufacturing       4.3       3.6      -0.7    3.0      -0.4      -1.2
  Durable           6.0       5.4      -0.6    2.8      -0.6      -3.1
  Nondurable        2.6       1.8      -0.8    3.4       0.0       0.8
-------------------------------------------------------------------------
                      Percent change from same quarter a year ago

Business            4.8       2.2      -2.5    2.5       1.2      -2.2
Nonfarm business    4.8       2.2      -2.5    2.4       1.1      -2.3
Manufacturing       5.2      -1.2      -6.1    3.4       2.1      -1.6
  Durable           6.0      -1.9      -7.4    3.5       2.2      -2.3
  Nondurable        3.8      -0.3      -4.0    3.5       2.2      -0.3
-------------------------------------------------------------------------

Business

     From the first to the second quarter of 2002, business sector
productivity rose at a 1.7 percent annual rate, as output increased 0.5
percent and hours of all persons engaged in the sector decreased 1.2 percent
(tables A and 1).  In the first quarter of 2002, productivity had increased
8.3 percent when output increased 5.9 percent and hours fell 2.2 percent.

     A 4.0-percent rise in hourly compensation in the second quarter of 2002
was similar to the 3.8-percent increase one quarter earlier (seasonally
adjusted annual rates).  Hourly compensation includes wages and salaries,
supplements, employer contributions to employee benefit plans, and taxes.
Real hourly compensation, which takes into account changes in consumer
prices, increased 0.5 percent in the second quarter of 2002, after rising 2.3
percent in the first quarter.

     Changes in unit labor costs reflect changes in both hourly compensation
and productivity.  Unit labor costs increased 2.3 percent in the second
quarter of 2002, after falling 4.2 percent in the first quarter (seasonally
adjusted annual rates).  The implicit price deflator for the business sector
rose 0.5 percent in the second quarter, as the increase in unit labor costs
was partially offset by a 2.2 percent drop in unit nonlabor payments.

Nonfarm business

     Productivity in the nonfarm business sector increased 1.5 percent during
the second quarter of 2002, as output rose 0.8 percent and hours of all
persons declined 0.7 percent (table A).  In the first quarter of 2002, output
per hour in the nonfarm business sector had increased 8.6 percent, as output
grew 6.2 percent and hours fell 2.2 percent (table 2).

     Hourly compensation grew at a 3.7 percent annual rate in the second
quarter of 2002, following a 3.6 percent increase in the first quarter.  When
the rise in consumer prices is taken into account, real hourly compensation
increased 0.2 percent in the second quarter of 2002.

     Unit labor costs increased 2.1 percent in the second quarter of 2002.
This measure had decreased 4.6 percent in the first quarter.  Unit nonlabor
payments edged down 0.1 percent in the second quarter of 2002, and the
implicit price deflator for nonfarm business output rose 1.3 percent
(seasonally adjusted annual rates).

Manufacturing

     In the second quarter of 2002, productivity increased 4.3 percent in
manufacturing, as output increased 3.6 percent and hours of all persons
declined 0.7 percent (seasonally adjusted annual rates).  Hours worked in
manufacturing had the smallest decline since the second quarter of 2000, when
they increased 0.5 percent.  In the durable goods sector, productivity grew
6.0 percent in the second quarter of 2002, as output grew 5.4 percent and
hours declined 0.6 percent.  In nondurable goods, output per hour rose 2.6
percent as output increased 1.8 percent and hours decreased 0.8 percent
(tables 3, 4, and 5).

     The hourly compensation of all manufacturing workers increased 3.0
percent during the second quarter of 2002, reflecting a 2.8-percent rise in
hourly compensation in durable goods industries and a 3.4-percent increase in
the nondurable goods sector.  Real hourly compensation in the total
manufacturing sector declined 0.4 percent in the second quarter, after
increasing 5.4 percent one quarter earlier.

     Unit labor costs in manufacturing fell 1.2 percent in the second quarter
of 2002.  This was the fourth consecutive quarterly decline in the series.
Unit labor costs decreased 3.1 percent in durable goods and increased 0.8
percent in nondurable goods in the second quarter of 2002.

Nonfinancial corporations

     Preliminary second-quarter 2002 measures of productivity and costs also
were announced today for nonfinancial corporations (tables B and 6).
Productivity increased 5.0 percent during the second quarter, as output rose
4.4 percent and hours fell 0.6 percent (seasonally adjusted annual rates).
The second-quarter drop in hours was the smallest since a decline of 0.5
percent in the fourth quarter of 2000.  Nonfinancial corporations include all
corporations doing business in the United States except those classified as
depository institutions, nondepository institutions, security and commodity
brokers, insurance carriers, regulated investment offices, small business
investment offices, and real estate investment trusts.

--------------------------------------------------------------------------
Table B.  Nonfinancial corporations: Preliminary second-quarter 2002
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

2002 II  5.0      4.4    -0.6    4.2      0.8     -0.8   -3.7     -0.4
--------------------------------------------------------------------------
               Percent change from same quarter a year ago

2002 II  6.0      3.3    -2.5    3.4      2.1     -2.5   11.5     -0.6
--------------------------------------------------------------------------

     Hourly compensation rose 4.2 percent in the second quarter of 2002,
following a 4.1 percent increase in the first quarter.  When the rise in
consumer prices is taken into account, real hourly compensation increased
0.8 percent in the second quarter and 2.6 percent in the first quarter of
2002 (table 6).

     Unit labor costs for nonfinancial corporations decreased 0.8 percent
in the second quarter of 2002, similar to the 0.9-percent decline in the
first quarter of the year.  Unit profits fell 3.7 percent in the second
quarter of 2002, after falling 0.6 percent in the first quarter.  The
implicit price deflator for nonfinancial corporate output edged down 0.4
percent in the second quarter of 2002.

Revised Measures

     Current and previous measures for the second quarter of 2002 for the
business, nonfarm business, and manufacturing sectors are compared in 
table C.  The quarterly movements differ from those reported on Aug. 9 based
on information then available.  In the business and nonfarm business sectors,
output and productivity were revised up, and unit labor costs were revised
down.  In the manufacturing sector, productivity was revised down, as output
grew less rapidly than originally reported.  Unit labor costs in
manufacturing fell less than reported on Aug. 9.

-----------------------------------------------------------------------
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 2002
Business:                                                      
  Previous          1.4      0.3     -1.1    3.9      0.5       2.4
  Current           1.7      0.5     -1.2    4.0      0.5       2.3
Nonfarm business:                                              
  Previous          1.1      0.5     -0.7    3.6      0.2       2.4
  Current           1.5      0.8     -0.7    3.7      0.2       2.1
Manufacturing:                                                 
  Previous          4.9      4.1     -0.8    3.0     -0.4      -1.8
  Current           4.3      3.6     -0.7    3.0     -0.4      -1.2
-----------------------------------------------------------------------


                              Next release date

     The next release of Productivity and Costs is scheduled for 8:30 AM EST,
Thursday, Nov. 7, 2002.  Preliminary third-quarter measures for business,
nonfarm business, and manufacturing will be released at that time.

----------------------------------------------------------------------------
Effective with the release of preliminary third-quarter 2002 data on Nov. 7,
BLS will begin to issue revised measures of hourly compensation and unit
labor costs for the previous two quarters.  Currently, only the most recent
quarter is revised.  This practice will be followed whenever preliminary
quarterly estimates are first announced.  Measures for the nonfinancial
corporate sector, including productivity and output, also will be subject to
an additional quarter of revisions.  This change is in accordance with the
announcement by the Bureau of Economic Analysis of their new revision
schedule for wage and salary data.  See  "National Income and Product
Accounts" (BEA 02-23), released July 31.
----------------------------------------------------------------------------


                                      
                               TECHNICAL NOTES
                                      
Labor  Hours: Hours data for the labor productivity and cost measures include
hours for all persons working in the sector-wage and salary workers, the self-
employed,  and  unpaid  family  workers.  The primary  source  of  hours  and
employment data is the BLS Current Employment Statistics (CES) program, which
provides  monthly survey data on the number of jobs held by wage  and  salary
workers in nonfarm establishments.  The CES also provides average weekly paid
hours of production and nonsupervisory workers in these establishments.   The
Office of Productivity and Technology estimates average weekly paid hours  of
nonproduction  and supervisory workers.  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
Commerce  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 77 percent  of
the  value  of  GDP  in 1996. Nonfarm business, which also excludes  farming,
accounted for about 76 percent of GDP in 1996.
      Annual  indexes for manufacturing and its durable and nondurable  goods
components  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; nonelectrical  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 calculated on
the  basis of the costs incurred and the incomes earned from production.  The
output  measure excludes the following outputs from GDP: general  government;
nonprofit institutions; employees of private households; the rental value  of
owner-occupied  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 53 percent of the value of GDP in 1996.

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: 202-691-5200; Federal  Relay  Service
number: 1-800-877-8339.


  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

  2000       I     115.3      138.4     120.1     131.4       110.5      114.0       110.7      112.8
            II     117.2      140.3     119.7     132.4       110.5      113.0       114.1      113.4
           III     117.3      140.4     119.7     135.0       111.7      115.1       111.2      113.7
            IV     117.9      140.7     119.4     136.3       111.9      115.6       112.0      114.3

        ANNUAL     116.9      140.0     119.7     133.8       111.2      114.4       112.0      113.5

  2001       I     117.5      140.4     119.5     137.3       111.8      116.9       112.3      115.2
            II     117.4      139.4     118.7     137.5       111.0      117.1       113.6      115.8
           III     117.9      139.1     117.9     137.8       111.1      116.8       115.5      116.4
            IV     120.1      140.3     116.8     138.3       111.6      115.1       117.2      115.9

        ANNUAL     118.2      139.8     118.2     137.7       111.4      116.5       114.7      115.8

  2002       I     122.5      142.3     116.1     139.6       112.2      113.9       119.6      116.0
            II     123.0     r142.5     115.8     140.9      r112.4     r114.5       118.9     r116.1
  ---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

  2000       I       0.3        2.2       1.9      14.7        10.3       14.4       -15.1        2.4
            II       6.7        5.4      -1.2       3.0         0.0       -3.5        12.9        2.2
           III       0.4        0.4       0.0       8.3         4.6        7.8        -9.6        1.1
            IV       2.1        0.9      -1.2       3.7         0.7        1.6         2.6        1.9

        ANNUAL       3.0        4.1       1.0       6.8         3.4        3.7        -1.7        1.7

  2001       I      -1.5       -1.0       0.4       3.1        -0.6        4.7         1.1        3.4
            II      -0.2       -2.8      -2.6       0.5        -2.6        0.7         4.9        2.2
           III       1.8       -0.9      -2.6       0.9         0.2       -0.9         6.8        1.8
            IV       7.6        3.5      -3.9       1.4         1.7       -5.8         6.1       -1.6

        ANNUAL       1.1       -0.2      -1.3       2.9         0.2        1.8         2.4        2.0

  2002       I       8.3        5.9      -2.2       3.8         2.3       -4.2         8.3        0.3
            II      r1.7       r0.5     r-1.2      r4.0         0.5       r2.3       r-2.2       r0.5
  ---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

  2000       I       2.3        4.6       2.3       5.9         2.5        3.5        -2.0        1.4
            II       4.1        5.4       1.3       6.5         3.1        2.3         0.8        1.7
           III       3.3        4.1       0.7       7.7         4.1        4.3        -2.5        1.7
            IV       2.4        2.2      -0.1       7.3         3.8        4.9        -2.9        1.9

        ANNUAL       3.0        4.1       1.0       6.8         3.4        3.7        -1.7        1.7

  2001       I       1.9        1.4      -0.5       4.5         1.2        2.6         1.4        2.2
            II       0.2       -0.7      -0.9       3.9         0.5        3.6        -0.4        2.1
           III       0.5       -1.0      -1.5       2.0        -0.6        1.5         3.8        2.3
            IV       1.9       -0.3      -2.2       1.5        -0.3       -0.4         4.7        1.4

        ANNUAL       1.1       -0.2      -1.3       2.9         0.2        1.8         2.4        2.0

  2002       I       4.3        1.4      -2.8       1.6         0.4       -2.6         6.5        0.7
            II      r4.8        2.2      -2.5       2.5         1.2       -2.2        r4.7        0.3
  ---------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                       September 5, 2002
  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

  2000       I     114.7      138.7     120.9     130.8       110.0      114.0       112.3      113.4
            II     116.4      140.5     120.7     131.5       109.8      113.0       115.6      113.9
           III     116.6      140.6     120.6     134.3       111.1      115.2       112.8      114.3
            IV     117.1      141.0     120.4     135.3       111.2      115.6       113.4      114.8

        ANNUAL     116.2      140.2     120.6     133.0       110.6      114.4       113.5      114.1

  2001       I     116.7      140.7     120.6     136.3       110.9      116.8       113.8      115.7
            II     116.6      139.7     119.8     136.3       110.1      116.9       115.3      116.3
           III     117.2      139.4     118.9     136.7       110.2      116.6       117.2      116.8
            IV     119.3      140.4     117.7     137.2       110.7      115.0       119.2      116.5

        ANNUAL     117.5      140.1     119.2     136.6       110.5      116.3       116.4      116.3

  2002       I     121.8      142.5     117.0     138.4       111.3      113.6       121.3      116.4
            II    r122.3     r142.8     116.8    r139.7       111.3     r114.2      r121.3      116.8
  ---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

  2000       I       0.2        1.9       1.7      15.2        10.7       14.9       -15.3        2.7
            II       6.0        5.4      -0.6       2.2        -0.7       -3.6        12.2        1.9
           III       0.6        0.2      -0.4       8.7         4.9        8.0        -9.1        1.4
            IV       1.7        1.1      -0.6       3.1         0.2        1.4         2.1        1.6

        ANNUAL       2.9        4.0       1.0       7.0         3.5        3.9        -1.7        1.8

  2001       I      -1.5       -0.9       0.5       2.8        -0.9        4.3         1.5        3.3
            II      -0.1       -2.7      -2.6       0.1        -2.9        0.3         5.1        2.0
           III       2.1       -0.8      -2.9       1.0         0.3       -1.1         6.8        1.7
            IV       7.3        2.9      -4.1       1.5         1.8       -5.4         6.9       -1.0

        ANNUAL       1.1       -0.1      -1.2       2.7        -0.1        1.6         2.5        1.9

  2002       I       8.6        6.2      -2.2       3.6         2.2       -4.6         7.5       -0.2
            II      r1.5       r0.8      -0.7      r3.7         0.2       r2.1       r-0.1       r1.3
  ---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

  2000       I       2.3        4.5       2.1       6.2         2.8        3.7        -1.8        1.7
            II       4.0        5.4       1.3       6.6         3.2        2.5         0.7        1.8
           III       3.3        3.9       0.6       7.9         4.3        4.5        -2.6        1.8
            IV       2.1        2.2       0.0       7.2         3.7        4.9        -3.1        1.9

        ANNUAL       2.9        4.0       1.0       7.0         3.5        3.9        -1.7        1.8

  2001       I       1.7        1.4      -0.3       4.2         0.9        2.4         1.4        2.1
            II       0.2       -0.6      -0.8       3.6         0.3        3.5        -0.3        2.1
           III       0.5       -0.8      -1.4       1.8        -0.8        1.2         3.9        2.2
            IV       1.9       -0.4      -2.3       1.4        -0.4       -0.5         5.1        1.5

        ANNUAL       1.1       -0.1      -1.2       2.7        -0.1        1.6         2.5        1.9

  2002       I       4.4        1.3      -2.9       1.6         0.3       -2.7         6.6        0.6
            II      r4.8       r2.2      -2.5       2.4         1.1      r-2.3         5.2       r0.4
  ---------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                       September 5, 2002
  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

  2000       I            133.6        138.3        103.5        131.4          110.5          98.4
            II            134.9        139.8        103.6        129.3          107.9          95.9
           III            135.4        139.3        102.9        132.2          109.4          97.7
            IV            135.9        137.6        101.3        131.5          108.0          96.7

        ANNUAL            134.9        138.7        102.8        131.1          109.0          97.2

  2001       I            135.4        135.1         99.8        132.0          107.4          97.5
            II            135.4        133.0         98.2        133.0          107.4          98.2
           III            136.4        131.3         96.3        133.3          107.5          97.8
            IV            137.6        129.2         93.9        134.3          108.3          97.6

        ANNUAL            136.2        132.1         97.1        133.1          107.7          97.8

  2002       I            140.9        130.2         92.4        136.5          109.8          96.9
            II           r142.3       r131.3        r92.3        137.5          109.7         r96.6
  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  2000       I              4.5          2.7         -1.7         25.3           20.5          19.9
            II              3.8          4.4          0.5         -6.3           -9.0          -9.7
           III              1.6         -1.3         -2.8          9.5            5.8           7.8
            IV              1.6         -4.8         -6.3         -2.3           -5.1          -3.8

        ANNUAL              4.1          2.5         -1.5          7.4            3.9           3.2

  2001       I             -1.5         -7.1         -5.6          1.6           -2.1           3.1
            II              0.0         -6.2         -6.2          3.1           -0.1           3.1
           III              2.9         -4.9         -7.6          1.0            0.3          -1.9
            IV              3.8         -6.3         -9.7          2.9            3.2          -0.9

        ANNUAL              0.9         -4.8         -5.6          1.5           -1.2           0.6

  2002       I              9.7          3.0         -6.1          6.9            5.4          -2.6
            II             r4.3         r3.6        r-0.7          3.0           -0.4         r-1.2
  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  2000       I              4.4          3.6         -0.8          8.9            5.5           4.3
            II              4.7          3.8         -0.8          6.9            3.5           2.1
           III              4.3          2.6         -1.7          7.9            4.3           3.4
            IV              2.9          0.2         -2.6          5.9            2.4           2.9

        ANNUAL              4.1          2.5         -1.5          7.4            3.9           3.2

  2001       I              1.3         -2.3         -3.6          0.5           -2.7          -0.9
            II              0.4         -4.9         -5.2          2.9           -0.5           2.5
           III              0.7         -5.7         -6.4          0.8           -1.8           0.1
            IV              1.3         -6.1         -7.3          2.1            0.3           0.8

        ANNUAL              0.9         -4.8         -5.6          1.5           -1.2           0.6

  2002       I              4.0         -3.7         -7.4          3.4            2.2          -0.6
            II             r5.2        r-1.2         -6.1          3.4            2.1         r-1.6
  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                September 5, 2002
  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

  2000       I            148.6        162.9        109.7        130.8          109.9          88.0
            II            150.0        165.2        110.2        127.5          106.4          85.0
           III            150.3        164.6        109.5        130.6          108.0          86.9
            IV            150.1        162.0        107.9        128.4          105.5          85.5

        ANNUAL            149.7        163.7        109.3        129.3          107.5          86.4

  2001       I            149.0        157.9        106.0        129.4          105.3          86.8
            II            149.1        155.3        104.1        130.5          105.4          87.5
           III            150.1        152.2        101.4        130.2          105.0          86.7
            IV            150.9        148.6         98.5        131.8          106.3          87.3

        ANNUAL            149.8        153.5        102.5        130.4          105.5          87.1

  2002       I            155.7        150.3         96.5        134.2          107.9          86.2
            II           r158.0       r152.3         96.4        135.1          107.7         r85.5
  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  2000       I              7.6          6.3         -1.2         29.7           24.6          20.5
            II              3.9          5.8          1.8         -9.6          -12.1         -13.0
           III              0.8         -1.6         -2.3          9.9            6.1           9.1
            IV             -0.6         -6.2         -5.7         -6.5           -9.2          -6.0

        ANNUAL              4.4          3.6         -0.7          7.7            4.2           3.2

  2001       I             -3.0         -9.7         -6.9          3.1           -0.6           6.2
            II              0.4         -6.5         -6.9          3.6            0.4           3.2
           III              2.7         -7.6        -10.0         -1.0           -1.7          -3.6
            IV              2.3         -9.2        -11.2          5.0            5.4           2.7

        ANNUAL              0.0         -6.2         -6.2          0.9           -1.9           0.8

  2002       I             13.2          4.7         -7.5          7.5            6.0          -5.0
            II             r6.0         r5.4        r-0.6          2.8           -0.6         r-3.1
  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  2000       I              5.2          5.1         -0.1         10.5            7.0           5.0
            II              5.1          5.3          0.2          7.4            4.0           2.2
           III              4.3          3.2         -1.1          8.1            4.5           3.6
            IV              2.9          1.0         -1.9          4.8            1.4           1.8

        ANNUAL              4.4          3.6         -0.7          7.7            4.2           3.2

  2001       I              0.3         -3.1         -3.3         -1.1           -4.2          -1.3
            II             -0.6         -6.0         -5.5          2.3           -1.0           3.0
           III             -0.1         -7.5         -7.4         -0.3           -2.8          -0.2
            IV              0.6         -8.2         -8.8          2.6            0.8           2.1

        ANNUAL              0.0         -6.2         -6.2          0.9           -1.9           0.8

  2002       I              4.5         -4.8         -8.9          3.7            2.5          -0.8
            II             r6.0        r-1.9        r-7.4          3.5            2.2         r-2.3
  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                September 5, 2002
  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

  2000       I            120.6        114.9         95.3        130.6          109.8         108.3
            II            121.8        115.6         95.0        130.4          108.9         107.1
           III            122.6        115.4         94.1        133.2          110.2         108.7
            IV            123.9        114.5         92.4        135.0          110.9         108.9

        ANNUAL            122.2        115.1         94.2        132.3          110.0         108.3

  2001       I            123.9        113.4         91.6        134.7          109.7         108.7
            II            123.6        111.7         90.4        135.5          109.4         109.6
           III            124.4        111.3         89.5        137.2          110.6         110.3
            IV            125.9        110.5         87.8        137.1          110.6         108.9

        ANNUAL            124.4        111.7         89.8        136.1          110.1         109.4

  2002       I            127.5        110.8         86.9        139.1          111.8         109.1
            II           r128.3       r111.3        r86.8        140.3          111.9         109.3
  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  2000       I              0.8         -1.8         -2.5         17.8           13.3          17.0
            II              3.8          2.4         -1.4         -0.5           -3.4          -4.2
           III              2.6         -0.9         -3.5          8.7            4.9           5.9
            IV              4.6         -3.0         -7.2          5.6            2.5           0.9

        ANNUAL              3.8          1.1         -2.6          6.7            3.3           2.9

  2001       I             -0.1         -3.7         -3.6         -0.8           -4.4          -0.7
            II             -0.9         -5.9         -5.0          2.3           -0.8           3.2
           III              2.5         -1.5         -3.8          5.1            4.4           2.5
            IV              4.9         -2.9         -7.4         -0.3            0.0          -5.0

        ANNUAL              1.8         -2.9         -4.7          2.9            0.1           1.0

  2002       I              5.3          1.2         -3.9          6.1            4.6           0.8
            II             r2.6         r1.8        r-0.8         r3.4           r0.0          r0.8
  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  2000       I              3.4          1.6         -1.8          6.1            2.8           2.6
            II              4.4          1.8         -2.5          5.8            2.5           1.4
           III              4.4          1.7         -2.5          7.4            3.8           2.9
            IV              2.9         -0.8         -3.7          7.7            4.2           4.6

        ANNUAL              3.8          1.1         -2.6          6.7            3.3           2.9

  2001       I              2.7         -1.3         -3.9          3.1           -0.1           0.4
            II              1.5         -3.4         -4.8          3.9            0.5           2.3
           III              1.5         -3.5         -4.9          3.0            0.4           1.5
            IV              1.6         -3.5         -5.0          1.5           -0.3           0.0

        ANNUAL              1.8         -2.9         -4.7          2.9            0.1           1.0

  2002       I              2.9         -2.3         -5.0          3.2            2.0           0.3
            II             r3.8         -0.3         -4.0          3.5            2.2          -0.3
  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                September 5, 2002
  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

  2000       I    116.7    146.0     125.1    126.9     106.7     108.7    105.4    107.8    120.5    108.9
            II    116.8    146.0     125.0    127.8     106.6     109.4    107.7    108.9    120.4    109.9
           III    117.6    146.9     125.0    130.4     107.9     110.9    108.9    110.4    111.4    110.5
            IV    117.3    146.4     124.8    131.7     108.2     112.2    111.0    111.9    100.4    110.9

        ANNUAL    117.1    146.3     125.0    129.2     107.4     110.3    108.3    109.8    113.2    110.0

  2001       I    116.6    145.2     124.6    131.3     106.9     112.6    113.7    112.9     94.9    111.4
            II    117.3    145.1     123.7    131.9     106.5     112.5    115.6    113.3     97.2    112.0
           III    118.2    145.0     122.7    132.7     107.0     112.3    117.6    113.7     99.7    112.5
            IV    121.3    146.9     121.2    133.6     107.8     110.2    116.2    111.8    109.6    111.6

        ANNUAL    118.3    145.6     123.0    132.4     107.0     111.9    115.8    112.9    100.3    111.9

  2002       I    122.8    148.3     120.8    134.9     108.5     109.9    116.0    111.6    109.4    111.4
            II    124.3    149.9     120.6    136.3     108.7     109.7    116.5    111.5    108.4    111.3
  ----------------------------------------------------------------------------------------------------------
                             Percent change from previous quarter at annual rate(5)

  2000       I      5.3      7.6       2.3     14.2       9.8       8.5      1.3      6.5    -17.6      3.9
            II      0.3     -0.2      -0.4      2.8      -0.1       2.6      8.9      4.2     -0.5      3.8
           III      2.6      2.6       0.0      8.5       4.7       5.7      4.5      5.4    -26.8      2.0
            IV     -0.7     -1.3      -0.5      4.1       1.1       4.9      7.8      5.6    -33.9      1.7

        ANNUAL      2.1      3.7       1.5      6.7       3.2       4.4      4.6      4.5    -14.1      2.5

  2001       I     -2.6     -3.2      -0.7     -1.2      -4.8       1.4     10.1      3.6    -20.2      1.6
            II      2.3     -0.4      -2.7      1.8      -1.3      -0.5      7.1      1.5     10.0      2.1
           III      3.2     -0.3      -3.4      2.5       1.9      -0.7      7.2      1.5     10.7      2.1
            IV     10.8      5.4      -4.8      2.7       3.0      -7.3     -5.0     -6.7     46.0     -3.3

        ANNUAL      1.0     -0.5      -1.5      2.5      -0.3       1.4      6.9      2.9    -11.3      1.7

  2002       I      5.1      3.7      -1.3      4.1       2.6      -0.9     -0.6     -0.8     -0.6     -0.8
            II      5.0      4.4      -0.6      4.2       0.8      -0.8      1.8     -0.1     -3.7     -0.4
  ----------------------------------------------------------------------------------------------------------
                          Percent change from corresponding quarter of previous year

  2000       I      2.1      4.8       2.6      5.6       2.3       3.4      3.8      3.5    -12.1      1.8
            II      2.1      4.0       1.9      6.2       2.8       4.0      5.0      4.3    -11.2      2.6
           III      2.6      3.8       1.2      7.6       4.0       4.9      4.1      4.7    -12.9      2.9
            IV      1.8      2.1       0.3      7.3       3.8       5.4      5.6      5.4    -20.6      2.8

        ANNUAL      2.1      3.7       1.5      6.7       3.2       4.4      4.6      4.5    -14.1      2.5

  2001       I     -0.1     -0.5      -0.4      3.5       0.2       3.6      7.8      4.7    -21.3      2.3
            II      0.4     -0.6      -1.0      3.2      -0.1       2.8      7.3      4.0    -19.3      1.9
           III      0.5     -1.3      -1.8      1.8      -0.8       1.2      8.0      3.1    -10.5      1.9
            IV      3.3      0.3      -2.9      1.4      -0.4      -1.8      4.7     -0.1      9.1      0.6

        ANNUAL      1.0     -0.5      -1.5      2.5      -0.3       1.4      6.9      2.9    -11.3      1.7

  2002       I      5.3      2.1      -3.1      2.8       1.5      -2.4      2.0     -1.2     15.3      0.0
            II      6.0      3.3      -2.5      3.4       2.1      -2.5      0.7     -1.6     11.5     -0.6
  ----------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                        September 5, 2002
  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
within 40 days of the close of the reference period; revisions appear 30 days
later and second revisions after an additional 60 days.  In the business
sector, the third publication (second revision) of a quarterly index of
output per hour of all persons has differed from the initial value by between
-1.6 and +1.7 index points approximately 95 percent of the time.  This
interval is based on the performance of this measure between the fourth
quarter of 1995 and the first quarter of 2002.



                            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)  The change for recent quarters is based on the Consumer Price Index for
     all urban consumers (CPI-U).  The trend from 1978-2001 is based on the
     Consumer Price Index research series (CPI-U-RS).
     
 (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