Table 7. Real capital input by asset type, 1948-96

Average annual growth rates (percent)

Private
business
Residential
rental
Period | All Assets | Equipment | Structures capital Inventories Land
1948-96 3.7 5.4 3.1 2.6 3.5 2.2
1948-73 3.8 5.5 3.2 3.2 43 2.1
1973-79 4.1 6.7 2.9 2.8 3.7 1.8
1979-90 3.8 S32! 3.5 2.0 21 3.3
1990-96 2.5 4.0 1.8 0.6 2.3 1.0
1995 3.2 5.4 1.7 0.8 49 0.9
1996 3.7 6.8 1.8 0.8 2.5 1.2
Private
nonfarm
business
Residential
rental
Period | All Assets | Equipment | Structures capital Inventories Land
1948-96 3.9 5.6 3.1 2.6 3.7 2.8
1948-73 4.0 5.6 3.2 3.2 46 2.8
1973-79 44 6.8 2.9 2.8 3.9 3.1
1979-90 4.0 5.5 3.6 2.0 2.3 3.6
1990-96 2.6 42 1.9 0.6 2.4 1.2
1995 3.4 5.5 1.8 0.8 5.1 14
1996 3.8 6.9 1.8 0.8 27 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.



14

Table 2. Private nonfarm business sector: Productivity and related measures, 1948-96!

Indexes 1992=100
Productivity Inputs
Output per | Output . Combined | Capital per
hour of all | per unit Multifactor Labor Capital | units of labor | hour of all
Year Person of capital Productivity” Output Input Services’ and capital® persons
1948 39.2 124.2 61.3 22.3 49.6 179 36.4 31.6
1949 41.0 121.0 62.5 22.3 475 18.4 35.6 33.8
1950 43.7 128.0 66.3 24.5 49.2 19.1 37.0 34.1
1951 45.0 130.8 68.0 26.4 51.6 20.2 38.8 34.4
1952 45.6 129.3 68.1 27.0 52.4 20.9 39.7 35.2
1953 46.5 131.0 68.9 28.2 54.1 21.6 41.0 35.5
1954 476 126.2 68.9 218 52.5 22.0 40.4 37.7
1955 49.8 132.7 TA 30.3 54.8 22.8 42.0 37.5
1956 49.6 130.4 7S 30.9 56.2 23.7 43.3 38.1
1957 50.9 128.7 721 315 56.1 24.5 43.7 39.5
1958 52.1 123.5 723 30.9 53.7 25.0 427 422
1959 53.6 129.4 748 33.2 56.2 25.6 44.4 AL4
1960 54.3 127.4 15.0 33.7 56.5 26.5 449 426
1961 56.0 126.6 16.0 34.4 56.3 27.1 45.2 44.2
1962 58.6 131.0 187 36.7 58.1 28.1 46.7 44.7
1963 60.6 132.1 80.7 38.4 58.8 29.1 416 45.9
1964 63.2 135.6 83.8 41.0 60.2 30.3 49.0 46.6
1965 65.2 138.0 86.1 43.9 62.4 318 51.0 47.2
1966 674 139.3 88.5 47.1 64.5 33.8 53.2 48.4
1967 68.6 133.6 88.4 479 645 35.8 54.1 514
1968 71.0 133.7 90.7 504 65.4 37.7 55.6 53.1
1969 1.1 130.7 89.9 51.9 67.6 39.7 57.7 54.4
1970 72.2 124.3 89.3 518 66.7 47 58.0 58.1
1971 75.2 123.6 92.0 53.8 66.2 43.5 58.5 60.8
1972 718 126.3 94.8 575 68.5 45.6 60.7 61.6
1973 80.3 128.2 975 618 2 48.2 63.4 62.6
1974 79.0 119.5 94.0 60.8 6 50.9 64.6 66.1
1975 81.2 113.0 94.3 597 68.4 52.8 63.3 118
1976 84.1 117.5 98.0 64.0 70.5 54.5 65.3 716
1977 85.4 119.6 99.6 677 73.5 56.6 67.9 m4
1978 86.5 121.7 101.0 72.0 712 59.2 n3 Ta
1979 85.8 118.7 99.9 74.0 798 623 741 23
1980 85.5 113 975 BA 19.4 65.6 149 168
1981 86.5 107.8 96.9 745 80.5 69.1 76.8 80.3
1982 86.1 100.1 93.7 721 79.2 72.0 76.9 86.0
1983 89.5 102.8 96.9 76.5 811 745 79.0 87.1
1984 91.2 106.2 99.0 827 86.1 719 83.5 85.9
1985 92.2 104.9 99.3 85.7 88.5 81.6 86.3 87.8
1986 94.6 103.9 100.4 88.6 89.6 85.3 88.3 911
1987 94.5 103.3 99.9 913 92.7 88.4 91.4 915
1988 95.2 104.2 100.2 95.1 96.6 91.2 94.9 913
1989 95.7 104.5 100.4 98.1 99.6 93.9 97.8 91.6
1990 96.2 102.5 99.7 98.8 100.3 96.4 99.1 93.9
1991 96.9 98.8 98.3 97.0 98.9 98.2 98.6 98.0
1992 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
1993 100.1 100.8 100.2 103.0 103.1 102.2 102.8 99.3
1994 100.5 102.1 100.5 107.1 107.3 104.9 106.6 98.4
1995 100.7 101.4 100.3 109.9 110.0 108.4 109.5 99.3
1996 102.6 101.1 101.2 113.7 112.3 112.5 112.4 101.5

See footnotes following table 6.

Source: Bureau of Labor Statistics



Table B. Compound average annual rates of growth in output per hour of all persons, the
contributions of capital intensity, labor composition, and multifactor productivity, by major
sector, 1948 to 1996

(percent per year)

Ttem 1948-96 | 1948-73 | 1973-79 | 1979-90 | 1990-96
Private business”
Output per hour of all persons 2.3 3.3 1k3 1.2 11
Contribution of capital intensity” 0.8 0.9 0.6 0.7 0.4
Contribution of labor composition? 0.2 0.2 0.0 0.3 0.4
Multifactor productivity* 1.2 2.1 0.6 0.2 0.3
Private nonfarm business!
Output per hour of all persons 2.0 2.9 1.1 1.0 Hel
Contribution of capital intensity” 0.7 0.8 0.7 0.7 0.4
Contribution of labor composition? 0.2 0.1 0.0 0.3 0.4
Multifactor productivity* 11 1.9 0.4 0.0 0.2
Contribution of R&D to 0.2 0.2 0.1 0.2 0.2
multifactor productivity

1. Excludes government enterprises.
2. Growth rate in capital services per hour times capital's share of current dollar costs.
3. Growth rate of labor composition (the growth rate of labor input less the
growth rate of hours of all persons) times labor's share of current dollar costs.
4. 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.

The post-1973 productivity slowdown is apparent in these data. During the period 1973
to 1979, gains in multifactor productivity slowed to only 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 0.6 percent, and labor composition made no contribution. Labor
productivity, therefore, increased only 1.3 percent per year from 1973 to 1979. A similar
slowdown occurred in private nonfarm business during the 1973-79 period.



21

Table 8. Manufacturing industries: Multifactor productivity trends, 1949-96

Average annual growth rates

Industry [1949-96 | 1949-73 | 1973-79 [1979-90 | 1990-96
Manufacturing 1.2 15 -0.4 1.0 19
Nondurable manufacturing 0.7 13 -0.5 0.3 0.4
Food and kindred products 0.5 0.7 0.0 0.4 0.4
Tobacco manufactures NA. NA. NA. NA. NA.
Textile mill products 2.2 2.2 3.3 2.0 14
Apparel & related products 07 0.7 19 0.5 -0.6
Paper and allied products 07 15 -1.2 0.1 0.5
Printing and publishing -0.2 0.5 -0.7 1d 0.9
Chemicals & allied products 11 2.5 +23 0.6 0.5
Petroleum refining 0.4 0.8 -0.5 0.1 0.5
Rubber & misc. plastic products 0.7 0.9 -1.8 14 Ll
Leather & leather products -0.4 -0.1 -0.2 1.2 0.2
Durable manufacturing 15 15 -0.3 1.6 3.0
Lumber and wood products 12 1.6 0.6 21 -13
Furniture and fixtures 0.6 0.6 0.6 0.5 0.6
Stone, clay, glass & concrete 0.8 11 -1.2 12 1.3
products

Primary metals industries 0.1 0.4 -19 0.2 1A
Fabricated metals products 0.4 0.5 -0.8 0.5 13
Industrial & commercial 1.6 0.8 0.1 28 45
machinery

Electrical & electronic machinery 3.2 2.2 15 3.1 9.4
Transportation equipment 0.7 14 0.3 0.1 01
Instruments 16 19 L7 15 0.4
Miscellaneous manufacturing 1.0 15 -0.9 1.5 0.2

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.


Table 6. Manufacturing sector: Productivity and related measures, 1950-96

18

Percent Change
Productivity Inputs
Output per | Output Purchased | Combined
hour of all | perunit | Multifactor | Sectoral Capital business | units of all
Year person of capital Productivity” Output Hours? | Services? | Energy | Materials | services inputs’
1950 7) 5.2 99 8.1 34 49 -0.8 173 45
1951 -0.9 0.1 67 16 92 116 28 118 65
1952 37 14 52 14 47 3.2 62 24 37
1953 33 19 85 5.0 3.9 3.2 99 65 65
1954 23 0.1 6.4 8.5 08 3.0 7.2 55 6.3
1955 46 29 103 55 38 13.8 10.1 11.6 WW
1956 0.7 13 08 15 5.0 96 06 47 22
1957 21 0.7 04 -16 33 7 07 27 0.2
1958 13 18 1.0 82 11 04 46 55 53
1959 2.0 44 88 67 18 65 08 69 42
1960 18 02 13 -0.4 27 2.0 21 16 1
1961 3.2 08 0.6 2.6 19 04 2.6 05 -03
1962 27 38 69 An 3.2 6.1 0.5 70 29
1963 41 28 52 10 3.1 54 24 91 23
1964 43 29 65 24 33 10.1 48 6.1 34
1965 21 25 2.6 8.0 59 54 58 32 73 53
1966 12 0.0 05 Wd 65 11 Tl 64 13.2 13
1967 40 AT 0.5 34 0.5 85 74 5.6 13.5 3.9
1968, 3.5 -0.8 26 5.0 15 58 6.6 20 0.2 24
1969 15 -25 0.9 26 dl 53 40 17 6.1 17
1970 33 6.8 -LS 2.9 5.9 41 13 54 3.4 “14
1971 64 04 29 26 -3.5 3.0 3.1 43 -1.0 0.2
1972 3.6 5.2 38 84 46 31 3.0 45 65 45
1973 28 3.0 22 8.0 5.0 48 35 66 87 57
1974 12 6.6 5.2 “12 23 58 14 13.1 78 43
1975 29 -1LS 2.6 12 9.8 49 6.9 1D 3.1 47
1976 40 5.1 35 9.0 48 37 38 77 22 53
1977 3.5 33 15 78 41 43 01 10.0 84 6.2
1978 12 08 re 54 42 45 12 59 -0.7 42
1979 0.6 34 0.6 14 19 5.0 42 18 3 2.0
1980 0.5 8.6 “17 41 46 49 4.0 24 “17 2.4
1981 15 3.6 12 08 -0.7 46 0.4 0.5 53 4
1982 5.5 6.6 1.6 -3.6 8.6 32 -10.0 -4.0 27 51
1983 33 37 20 46 13 09 Ll 23 13.2 26
1984 3.0 65 3.2 O7 65 29 64 96 13 6.2
1985 3.8 -08 12 3.0 0.7 3.9 33 40 44 18
1986 44 0.0 16 29 -15 29 09 16 92 12
1987 29 09 29 34 06 25 64 41 89 0.5
1988 15 28 16 46 3.0 7 41 05 99 29
1989 OL “17 AS 05 04 2.2 0.6 13 8.6 19
1990 24 25 0.5 0.2 2.2 28 23 14 5.0 07
1991 2.0 3.8 09 21 41 18 0S 06 7 -13
1992 54 29 17 48 -0.6 18 15 57 98 3.0
1993 2.0 17 13 34 14 17 $2 35 1.0 2.0
1994 3.1 35 29 55 23 19 3.2 2.0 5.0 26
1995, 41 14 39 45 04 31 18 26 43 0.6
1996 47 0.6 2.6 42 0.5 35 14 3.1 17 16

See footnotes following table 6.

Source: Bureau of Labor Statistics



10

Revisions to employment and hours reflect improved BLS estimates of the hours of non-
production workers and revisions to employment of proprietors prior to 1958 and after 1978.
Labor composition measures have been updated through 1996. A brief description, entitled
“Changes in the Composition of Labor for the BLS Multifactor Productivity Measures, 1995 and
1996,” is available on the BLS website at http://stats.bls.gov/mprlabor.htm or in print.

Table D. Average annual growth rate in private business output and inputs, 1948-94

(percent per year)
Capital Labor Multifactor
Output Services Input Productivity
Revised measures 3.4 3.7 14 13
Previous measures 3.4 3.7 13 13

Previous measures are from news release 95-518, January 16, 1996

The revisions to output, capital, and multifactor productivity were negligible for the
entire period (table D). For capital, increases in the growth rates of equipment, inventories, and
rental residential structures are entirely offset by shifts in the asset weights toward a more slowly
growing asset, land.

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.

The multifactor productivity data for private business and private nonfarm business
indexes 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 1948-96, the output indexes are supplied by the Bureau
of Economic Analysis (BEA). BLS adjusts these to eliminate the output of government
enterprises.


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 in this release compare
"value-added" output to two classes of inputs, capital and labor. Because of all these differences
in methods, productivity change in manufacturing cannot be directly compared with changes in
private business or private nonfarm business.

Manufacturing productivity in 1995 and 1996 and historical trends

Multifactor productivity in manufacturing rose 3.9 percent in 1995 and 2.6 percent in
1996 (table C). The 1995 productivity gain was the largest since 1959. While multifactor
productivity growth slowed in 1996, the increase was still larger than the average over the post-
war period (tables 3 and 6).

In 1995, sectoral output posted a 4.5 percent increase. Combined inputs grew only 0.6
percent, the smallest increase since 1991. Energy use increased 1.8 percent. Non-energy

materials input declined 2.6 percent -- the first drop in materials since 1991 and the largest
decline since 1987. Hours edged up 0.4 percent, while capital services increased 3.1 percent.

Table C. Productivity and related data in manufacturing, percentage changes, 1949-96

(percent per year)

Item [1949-96 | 1949-73 | 1973-79 | 1979-90 | 1990-96 | 1994-5 | 1995-6
Productivity
Multifactor Productivity’ 12 1S -0.4 1.0 19 3.9 2.6
Output per hour 27 2.6 2.0 2.6 3.6 41 47
of all persons
Output per unit 0.4 0.0 -2.2 -1.0 1.0 14 0.6
of capital services
Sectoral Output 3.3 41 24 1.9 3.3 45 42
Inputs
Hours” 0.6 14 0.3 -0.7 -0.2 0.4 -0.5
Capital services 3.7 4.1 47 2.9 2.3 3.1 3.5
Energy 2.9 5.0 0.6 0.3 2.3 1.8 14
Non-energy materials 2.4 2.6 5.3 0.8 18 -2.6 3.1
Purchased business 46 5.1 42 4.2 3.9 4.3 17
services
Combined inputs’ 2.0 2.5 2.8 09 14 0.6 1.6
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.



Between 1979 and 1990, multifactor productivity was almost unchanged in private
business and private nonfarm business. Output per hour; nevertheless, continued to advance at
about the same rates as in the 1973-79 period. The contribution of labor composition increased
to 0.3 percent per year in both sectors, essentially offsetting the decline in multifactor
productivity growth.

During the 1990-96 period, labor productivity in both sectors continued to advance at
about the same rates as in the previous period. However, the sources of labor productivity
shifted after 1990. The contribution of capital services slowed from 0.7 percent per year during
the 1979-90 period to only 0.4 percent per year in private business. As the baby boom
generation completed its entrance into prime working age, the contribution of labor composition
accelerated to 0.4 percent per year. Multifactor productivity grew 0.3 percent per year. Trends
in private nonfarm business were virtually identical.

While MFP reflects many influences, it is generally believed that technological change is
one of the primary contributors. For private nonfarm business, BLS also reports estimates of the
direct effects of firms’ spending for research and development (R&D) on MFP growth within
their own industries. Because many people associate R&D spending and the resulting
technological improvements with productivity, BLS has not adjusted MFP to exclude the effects
of R&D. Instead, the estimated effects are shown separately (table B). The contribution of R&D
averaged 0.2 percent per year for the entire 1948-96 period. The contribution of R&D slowed
during the 1973-79 period and has since increased slightly.

Manufacturing

The BLS multifactor productivity measures (MFP) for manufacturing differ in several
ways from those underlying the private business and private nonfarm business measures 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 the data on 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, MFP 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).


19

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.


Revisions

The historical data for multifactor productivity in all sectors and industries reflect several
important changes and revisions to the data sources used to develop these series. The new
measures reflect new work by the Bureau of Economic Analysis (BEA), U.S. Department of
Commerce, on fixed reproducible tangible wealth. (These new measures are described in an
article by Ammold Katz and Shelby Herman, “Improved Estimates of Fixed Reproducible
Tangible Wealth, 1929-95,” in the May 1997 Survey of Current Business.) BLS uses the BEA
data on new investments in estimating capital services inputs. In addition to data revisions, BEA
expanded the detail available on office, accounting, and computer equipment. This category was
divided into seven categories of computers and computer peripherals and a residual category of
office and accounting equipment. In addition, BEA used new empirical evidence on economic
depreciation in revising its wealth estimates. BLS adjusted its service-life estimates of non-
residential capital for consistency with this new evidence. The effective depreciation rates for
equipment were largely unchanged. However, based on the empirical evidence, BEA reduced
the depreciation rates for most structures. While this had the effect of nearly doubling the BLS
measures of productive stocks of non-residential structures and land, it had almost no effect on
the growth rates of structures or land. A description of the revisions to the capital measures,
entitled “Revisions to Capital Inputs for the BLS Multifactor Productivity Measures,” is
available upon request and can be found on the BLS web site at
http://stats.bls.gov/mprcaptl.htm. A printed version of this paper may be requested by calling
(202) 606-5606.

Private business and private nonfarm business output series now fully reflect the
comprehensive revisions to the National Income and Product Accounts (NIPAs) announced by
the Bureau of Economic Analysis on January 19, 1996, and further updated on July 31, 1997. In
the previous news release, BLS had used chain-type, annually-weighted indexes of output.
However, until this release, BLS had not incorporated other aspects of the comprehensive
revisions into its multifactor productivity measures. The revised figures no longer exclude the
statistical discrepancy — the measure of the difference between GDP as measured on the product
side and the income side of the NIPAs.

Data on business services in manufacturing have been revised for the years 1988 to 1996.
The revised measures incorporate some information from the preliminary 1992 input-output
table published by the BEA.

Price deflators at the 4-digit SIC level have been revised by BEA. The largest revisions
are for computers and semiconductors, which are now based on BEA’s hedonic price indexes.
Constant dollar outputs and inputs in manufacturing and detailed industries reflect revisions in
the price deflators.


Internet address: http://stats.bls.gov/mprhome.htm

Historical, technical USDL 98-187
information: (202) 606-5606 For Release: 10:00 AM EDT
Media contact: (202) 606-5902 Wednesday, May 6, 1998

MULTIFACTOR PRODUCTIVITY TRENDS, 1995 AND 1996

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 labor and capital inputs--for 1995 and
1996. Multifactor productivity differs from the labor productivity (output per hour) measures
that are published quarterly by BLS. Multifactor productivity, unlike labor productivity, requires
information on capital services and other data not available on a quarterly basis.

In the most recent years available, multifactor productivity in the private business and
private nonfarm business sectors changed at the following percentage rates:

1994-95 1995-96
Private business -0.3 1.0
Private nonfarm business -0.2 09

Multifactor productivity in private business and private nonfarm business fell in 1995 for
the first time since 1991. Productivity rebounded in 1996 in both sectors; the gains were the
largest since 1992. The 1995 and 1996 annual changes are summarized in table A; further detail
and historical measures are shown in tables 1 through 8. The historical measures of multifactor
productivity have been substantially revised to incorporate revisions to source data. See page 9
for a more complete description of the revisions.


12

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 additive and do not include the
effect of changing labor composition.

Energy input is constructed using price 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, input measures 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) weights which 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.

The stock of research and development (R&D) in private nonfarm business is derived by
cumulating constant dollar measures of R&D expenditures and allowing for depreciation.
Current dollar expenditures for privately financed R&D for the years 1953-96 are obtained from
annual issues of Research and Development in Industry published by the National Science
Foundation. Price deflators and estimates of the rate of depreciation are developed by BLS.
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."

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. The private nonfarm
business sector also 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.

These 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, they reflect the joint effects of many factors, including
new technology, economies of scale, managerial skill, and change in the organization of
production.


11

Capital input measures the services derived from the stock of physical assets. The assets
included are fixed business equipment, structures, inventories, and land. Structures include
nonresidential structures and residential capital which 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) weighting 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 November 1997.

Labor input in private business and private nonfarm business is obtained by (Tornqvist)
weighting the hours worked by all persons, classified by education, work experience, and gender,
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 which 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.

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 Manufacturers (ASM) and the Census of
Manufacturers (CM) from the Bureau of the Census, U.S. Department of Commerce, together
with Producer Price Indexes from BLS and price data from BEA. Output data between 1988 and
1991 have been adjusted to reflect data on shipments from manufacturing establishments
compiled by the Bureau of the Census. These data adjust for previously uncaptured growth of
new establishments for the years 1988-91; adjustments for data after 1992 are not yet available.
Using these data, BLS has prepared sectoral output measures by excluding transactions between
manufacturing establishments in the same sector.


In 1996, the 2.6 percent gain in multifactor productivity was accompanied by a 4.2
percent advance in sector output and a 1.6 percent increase in combined inputs. Output growth
was similar to gains in recent years. The increase in combined inputs was slightly below the
post-war average. Energy use continued to expand at a moderate pace of 1.4 percent in 1996.
Materials reversed its 1995 decline with a gain in 1996 of 3.1 percent. Capital services
continued its strong growth, posting a 3.5 advance, the largest increase since 1985. Hours
declined 0.5 percent.

Multifactor productivity grew 1.2 percent annually between 1949 and 1996. Sectoral
output increased at a 3.3 percent annual rate, and combined inputs rose 2.0 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 0.4 percent per year between
1973 and 1979. Since combined inputs grew at about the same rate in both periods, the decline
in the growth rate of productivity was associated with slower output growth.

Between 1979 and 1990, multifactor productivity growth in manufacturing rebounded
sharply to 1.0 percent per year. Sectoral output growth continued to slow, and, in this period,
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 is associated with slower growth in combined inputs. Between 1990 and
1996, multifactor productivity growth accelerated, exceeding the pre-1973 growth rate.
Multifactor productivity advanced 1.9 percent per year during this period, primarily because
output growth nearly doubled to 3.3 percent per year while combined inputs rose only 1.4
percent annually. The decline in hours abated, but the growth rate of materials doubled. Energy
use, which had been almost stagnant, jumped 2.3 percent per year after 1990.

Among detailed manufacturing industries, electrical and electronic machinery and textile
mills reported the largest long-term gains in multifactor productivity (table 8). Over the 1949-96
period, multifactor productivity fell gradually in the printing and publishing and the leather
goods industries. Since 1990, productivity in electrical and electronic machinery has grown
rapidly at 9.4 percent per year. Industrial and commercial machinery also has posted large
productivity gains of 4.5 percent annually.




1996. Multifactor productivity in 1996 advanced 0.9 percent, the most rapid growth
since 1992, Output rose 3.5 percent, and combined units of capital and labor increased 2.6
percent. The trend of faster growth in capital services and slower growth in labor input
continued in 1996. Capital services rose 3.8 percent, while labor input grew 2.1 percent.

Labor productivity jumped 1.9 percent in 1996. Contributing to this gain was a 2.2
percent increase in capital services per hour. Capital productivity declined 0.3 percent, but this
was only about half the size of the decline in 1995.

Long-term trends in private business and private nonfarm business

Labor productivity growth (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 shifts 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. However,
multifactor productivity (MFP) treats capital as an explicit factor of production, and so it is
computed net of changes in capital intensity. In addition, BLS measures labor input as the
combined effect of changes in hours at work and shifts in the educational attainment and work
experience of the work force. Therefore, MFP is computed net of 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 the composition of the work force.

From 1948 to 1996, output per hour grew at an annual rate of 2.3 percent in private
business and 2.0 percent in private nonfarm business (table B). Of the 2.3 percent growth rate in
labor productivity in private business, 1.2 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 trends in the private nonfarm business sectors were similar. The
contribution of capital intensity equals the change in the capital-hours ratio multiplied by
capital's share of total costs. 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
costs. Historically, capital's share has been less than one-third of total costs.

From 1948 to 1973, multifactor productivity grew at an annual rate of 2.1 percent in
private business and 1.9 percent in private nonfarm business. These rates, combined with the
growth rates in the contributions of capital intensity and labor composition, resulted in labor
productivity growth rates of 3.3 percent and 2.9 percent, respectively, in private business and
private nonfarm business.


Table 3. Manufacturing sector: Productivity and related measures, 1949-96

Indexes 1992=100

15

Productivity Inputs
Output per | Output Purchased | Combined
hour of all | per unit Multifactor, | Sectoral Capital business | units of all
Year person of capital Productivity” Output Hours? | Services? | Energy | Materials | services inputs'?
1949 33.3 130.0 62.8 26.3 79.0 20.2 28.6 34.1 13.4 Ago
1950 33.8 138.1 66.0 28.9 85.4 20.9 30.0 33.9 15.7 43.8
1951 33.5 134.9 66.1 30.8 919 22.9 33.5 34.8 17.5 46.6
1952 34.8 135.4 67.1 32.4 93.2 23.9 34.6 37.0 18.0 48.3
1953 35.9 1415 68.3 35.2 979 24.9 35.7 40.6 19.1 SLS
1954 36.8 1314 68.3 32.9 89.5 25.1 36.7 317 18.1 48.2
1955 38.4 139.6 70.3 36.3 94.4 26.0 ALS 415 20.2 51.6
1956 38.2 134.0 69.3 36.6 95.9 213 45.8 418 211 52.8
1957 39.0 130,3 69.8 36.8 94.3 28.2 46.6 415 217 52.7
1958 39.5 119.8 68.6 34.2 86.6 28.5 46.8 39.6 20.5 49.8
1959 40.3 128.1 16 37.2 92.4 29.0 49.8 39.9 21.9 51.9
1960 41.0 126.3 718 37.7 92.0 29.8 50.9 40.9 22.3 52.5
1961 42.3 124.7 724 37.9 89.6 30.4 Sul 42.0 22.2 52.4
1962 43.4 129.2 751 40.5 93.3 313 54.2 41.8 23.7 53.9
1963 45.2 131.8 77.2 42.6 94.3 323 571 427 25.9 55.2
1964 ATA 135.8 79.5 45.4 96.2 33.4 628 447 275 S71
1965 48.1 139.1 81.6 49.0 101.9 35.2 66.5 46.2 29.4 60.1
1966 48.7 139.2 81.9 52.8 108.5 37.9 12 49.1 333 64.4
1967 50.6 132.6 81.5 54.6 107.9 412 76.5 51.9 378 66.9
1968 52.3 131.6 83.7 573 109.5 43.5 815 52.9 379 68.5
1969 53.1 128.3 84.5 58.8 110.8 45.9 84.7 52.0 40.2 69.7
1970 54.8 119.6 83.2 57.1 104.2 478 83.6 54.8 38.8 68.7
1971 58.4 119.1 85.6 58.6 100.5 49.2 86.2 57.2 38.5 68.5
1972 60.5 125.3 88.8 63.6 105.1 50.8 88.8 59.7 41.0 116
1973 62.2 129.1 90.8 68.7 110.5 53.2 919 63.7 44.6 75.7
1974 62.9 120.6 86.1 67.9 107.9 56.3 93.2 72.0 48.0 78.9
1975 64.8 106.7 83.8 63.0 973 59.0 86.8 10.6 46.5 75.2
1976 67.4 121 86.8 68.7 101.9 61.2 90.0 76.1 415 79.2
1977 69.7 1159 88.0 74.0 106.2 63.9 90.2 83.7 51S 84.1
1978 705 116.8 89.0 78.0 110.6 66.8 913 88.6 51.2 87.7
1979 70.1 112.8 88.5 791 112.7 70.1 95.1 87.0 57.0 89.4
1980 70.5 103.1 86.9 75.8 107.6 735 913 84.9 56.0 87.2
1981 116 99.4 88.0 76.4 106.8 76.9 91.0 84.5 53.0 86.9
1982 75.5 92.9 89.4 73.7 97.6 79.3 81.9 81.2 S16 82.4
1983 19 96.3 911 TA 98.9 80.1 82.8 83.0 58.4 84.6
1984 80.2 102.6 94.1 84.5 105.4 82.4 88.1 91.0 57.6 89.9
1985 83.2 101.7 95.2 87.1 104.6 85.6 85.2 94.6 60.1 915
1986 86.9 101.7 96.7 89.6 103.1 88.1 86.0 96.1 65.7 92.6
1987 89.4 102.6 99.5 92.7 103.7 90.3 91S 92.2 715 93.1
1988 90.7 105.5 101.1 96.9 106.8 919 95.2 92.6 78.6, 95.8
1989 90.8 103.7 99.6 97.4 107.2 93.9 95.8 93.8 85.4 977
1990 93.0 101.1 99.2 97.5 104.8 96.5 98.0 95.1 89.6 98.3
1991 94.9 97.2 98.3 95.4 100.6 98.2 98.5 94.6 91d 97.1
1992 100.0 100.0 100.0 100.0 100.0 100.0 100.0 - 100.0 100.0 100.0
1993 102.0 101.7 101.3 103.4 1014 101.7 105.2 103.5 101.0 102.0
1994 105.2 105.3 104.3 109.1 103.7 103.7 108.5 105.6 106.0 104.7
1995 109.6 106.7 108.3 114.1 104.1 106.9 110.4 102.9 110.6 105.3
1996 114.7 107.4 111 118.8 103.6 110.6 112.0 106.1 112.4 107.0

See footnotes following table 6.

Source: Bureau of Labor Statistics



17

Table 5. Private nonfarm business sector: Productivity and related measures, 1948-96

Percent Change

Productivity Inputs
Output per | Output Combined Capital per
hour of all | perunit | Multifactor Labor Capital | units of labor hour of all
Year | person | of capital | Productivity” | Output? | Input’ | Services” | and capital” | persons
1949 44 26 2.0 0.0 41 2.6 -2.0 72
1950 67 58 6.1 10.0 3.6 4.0 37 09
1951 29 22 27 78 48 5.5 5.0 07
1952 13 AA 0.0 22 17 34 2.2 25
1953 2.0 13 12 45 32 3.2 3.2 07
1954 23 3.6 0.0 14 29 23 -14 6.1
1955 AT Sa 47 89 42 3.6 4.0 0.4
1956 -0.4 7 -0.9 21 2.6 39 3.0 14
1957 25 13 1.0 18 0.1 3.2 0.9 39
1958 24 41 03 21 43 21 24 68
1959 29 48 34 16 47 2.6 4.0 19
1960 12 -16 03 16 04 3.2 13 2.8
1961 3.2 0.6 13 19 03 2.6 0.6 38
1962 47 35 3.6 69 3.2 34 33 LL
1963 35 09 25 45 12 37 2.0 26
1964 43 2.6 3.8 68 23 4.1 29 16
1965 3.0 18 27 70 38 5.1 42 12
1966 35 0.9 28 11 33 61 42 25
1967 18 41 01 17 0.1 6.1 18 62
1968 3.5 0.1 26 53 14 5.2 26 34
1969 O1 2.2 0.9 3.0 33 54 39 24
1970 15 49 07 0.2 13 49 05 67
1971 42 0.6 3.0 3.8 0.6 44 0.8 47
1972 34 21 3.0 10 34 48 38 12
1973 3.2 15 28 74 38 5.8 44 17
1974 15 6.8 3.5 1.6 0.6 5.6 20 56
1975 27 54 03 18 44 3.8 21 86
1976 3.6 39 40 72 3.1 31 31 03
1977 15 18 16 57 42 3.8 41 03
1978 13 17 14 64 51 46 49 0.4
1979 -0.8 2.4 oll 28 33 53 39 17
1980 0.4 6.2 23 12 0.6 53 Ll 6.2
1981 12 3.1 -0.6 19 1S 5.2 26 45
1982 0.6 12 33 3.2 “1.6 43 0.1 cal
1983 40 27 34 61 24 34 27 13
1984 18 33 2.2 8.0 6.2 45 57 15
1985 Lt 12 0.2 3.6 27 49 3.4 23
1986 27 -1.0 Al 35 13 45 23 3.7
1987 0.2 0.6 -0.4 3.0 34 3.6 35 05
1988 07 09 02 41 42 3.2 39 0.2
1989 0.6 03 02 3.2 31 29 3.0 03
1990 0.5 -19 -0.6 07 0.7 27 13 25
1991 0.7 3.6 “14 18 14 19 04 45
1992 3.2 12 17 3.1 12 19 14 2.0
1993 0.1 08 02 3.0 3.1 2.2 28 07
1994 03 13 03 3.9 41 2.6 37 0.9
1995 02 0.7 0.2 26 25 34 28 09
1996, 19 03 0.9 3.5 21” 3.8 2.6 2.2

See footnotes following table 6.

Source: Bureau of Labor Statistics



Table A. Productivity and related data, percentage changes, 1994-95 and 1995-96

Private Nonfarm
Item Private Business’ Business’
1994-5 | 1995-6 | 1994-5 | 1995-6

Productivit

Multifactor Productivity” -0.3 1.0 -0.2 0.9

Output per hour of all persons 0.0 2.0 0.2 19

Output per unit of capital services -0.8 -0.2 -0.7 -0.3
Output 2.4 3.5 2.6 3.5
Inputs

Labor input’ 2.5 19 2.5 21

Capital services 3.2 3.7 3.4 3.8

Combined units of labor and capital inputs* 2.7 2.5 2.8 2.6
Analytic ratio:

Capital services per hour of all persons 0.8 2.2 0.9 2.2
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 group’s share of labor compensation.
4, Labor input index combined with capital service input index,

weighted by labor's and capital's shares of nominal output.

Labor productivity rose 2.0 percent in 1996. This rate was much faster than during the
1993-95 period. Capital productivity declined slightly in 1996. Capital services per hour
advanced sharply at a 2.2 percent rate, reflecting the faster growth in capital services and the
slower growth in hours at work. This was the largest gain since 1991.

Private nonfarm business

1995. In 1995, multifactor productivity in private nonfarm business declined 0.2 percent,
offsetting most of the increase in 1994 (tables 2 and 5). Output rose 2.6 percent, and combined
units of capital and labor inputs advanced 2.8 percent. Labor input grew 2.5 percent; most of this
growth was due to increased employment. Capital services grew 3.4 percent, the largest gain in
8 years. The services of equipment and of inventories were the fastest growing components of
capital services (table 7).

Labor productivity grew 0.2 percent in 1995, about the same rate as in 1994. The 0.7
percent drop in capital productivity was the first since 1991. Capital services per hour, which
fell in 1993 and 1994, posted a 0.9 percent gain in 1995.


Private business and private nonfarm business

For 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. Multifactor
productivity does not measure the specific contributions of labor, capital, or any other factor of
production. Instead, it reflects the joint effects of many factors, including new technology,
economies of scale, managerial skill, and changes in the organization of production.

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.

Private business sector

1995. Multifactor productivity fell slightly, 0.3 percent, in 1995, continuing a pattern of
small gains and losses that began in 1993. The slight decline in 1995 offset about half of the
gains of 1993 and 1994. Output grew 2.4 percent, and the combined inputs of capital and labor
rose 2.7 percent. The increase in output was the smallest since the recession year of 1991.

Growth in capital services outpaced labor input in 1995. Capital services accelerated to a
growth rate of 3.2 percent -- the steepest gain since 1987, but still slightly slower than the
average 3.7 percent rate over the last 50 years. While all forms of capital grew more rapidly in
1995 than in 1994, equipment and inventories grew most rapidly (table 7), Labor input growth
slowed to 2.5 percent, an increase comparable with that of 1993. Virtually all of the rise in labor
input was due to gains in employment; the work week and the distribution of workers by
educational attainment and work experience were essentially unchanged.

Labor productivity or output per hour worked was unchanged in 1995. This was the first
time labor productivity failed to grow since 1987. Capital productivity (the ratio of output to
capital services) dipped 0.8 percent. Capital services per hour rose for the first time since 1992,
posting a gain of 0.8 percent in 1995.

1996. Multifactor productivity rose 1.0 percent in 1996, the largest gain since 1992.
Most of the faster growth in productivity was the result of a sharp 3.5 percent increase in output,
as the growth rate of combined inputs slowed to 2.5 percent.

The trend of accelerating growth in capital services and slower growth in labor input
continued in 1996. Capital services increased 3.7 percent or 0.5 percent faster than in 1995.
Among the types of capital, only equipment grew appreciably faster than in 1995. Equipment
continues to account for most of the acceleration in the growth rate of capital services. Labor
input growth slowed to 1.9 percent. Employment gains and shifts in the composition of the work
force accounted for all of the growth in labor input; the average work week declined.


Table 1. Private business sector: Productivity and related measures, 1948-96!

Indexes 1992=100

13

Productivity Inputs
Output per | Output Combined Capital per
hour of all | per unit Multifactor. Labor Capital | units of labor | hour of all
Year person of capital Productivity” Output? Input Services’ and capital® Persons
1948 34.7 116.6 56.2 23.0 57.3 19.7 41.0 29.8
1949 35.9 113.4 56.8 23.0 55.4 20.2 40.4 31.6
1950 39.0 120.2 61.0 25.3 56.5 21.0 415 32.5
1951 403 121.5 62.3 269 58.4 22.1 43.2 33.1
1952 411 120.2 62.9 275 58.6 22.9 43.7 34.2
1953 42.5 121.9 64.3 28.7 59.7 23.6 44.7 34.9
1954 43.6 117.9 64.4 28.4 58.0 24.1 44.1 37.0
1955 45.6 123.7 67.4 30.8 60.2 24.9 45.7 36.8
1956 45.7 121.6 67.1 314 61.2 25.8 46.8 37.6
1957 47.2 120.0 68.0 319 60.6 26.6 46.8 39.3
1958 48.5 1153 68.3 312 57.9 27.1 45.7 421
1959 49.9 120.5 10.6 33.4 60.3 278 474 41.5
1960 50.8 119.1 10.9 34.0 60.7 28.6 48.0 42.7
1961 52.7 118.5 723 347 60.0 29.2 479 44.4
1962 55.1 122.5 749 36.9 61.6 30.2 49.3 45.0
1963 573 123.7 71.0 38.6 62.1 312 50.1 46.3
1964 59.9 126.7 80.0 4.1 63.2 32.4 513 413
1965 62.1 129.3 82.5 43.9 65.2 34.0 53.3 48.0
1966 64.5 130.5 85.0 46.9 66.9 35.9 55.2 49.5
1967 66.0 125.7 85.1 418 66.8 38.0 56.2 52.5
1968 68.3 125.8 87.3 50.2 67.6 39.9 575 54.3
1969 68.6 123.4 86.8 517 69.6 419 59.6 55.6
1970 70.1 78 86.6 51.6 68.4 43.8 59.6 59.5
1971 BA 117.5 89.3 53.6 67.9 45.7 60.0 62.2
1972 155 120.0 919 573 10.2 47.7 623 629
1973 78.0 122.0 94.6 61.3 72.6 50.3 64.8 63.9
1974 167 114.1 91.2 603 BA 529 66.1 67.2
1975 79.4 109.0 92.1 59.7 69.9 54.8 64.8 728
1976 82.2 113.1 95.5 63.7 19 56.4 66.7 72.7
1977 83.5 115.4 97.2 674 748 58.4 69.3 T24
1978 84.4 117.3 98.4 715 78.6 60.9 726 72.0
1979 84.1 1153 97.8 36 81.0 63.8 75.2 72.9
1980 83.8 108.1 95.4 726 80.5 67.2 76.1 15
1981 85.3 105.6 95.5 745 81.7 70.5 78.0 80.8
1982 85.1 98.4 92.6 72.2 80.3 73.4 78.1 86.4
1983 87.7 100.1 94.7 75.8 82.1 758 80.1 87.6
1984 90.0 104.3 97.6 82.4 87.0 79.0 84.4 86.3
1985 915 103.6 98.4 85.6 89.1 82.7 87.0 88.4
1986 94.0 102.7 99.6 88.4 90.1 86.1 88.8 915
1987 94.0 102.4 99.3 911 93.1 89.0 918 O18
1988 94.6 103.3 99.4 94.6 96.8 91.6 95.1 916
1989 95.4 103.9 99.9 978 99.7 94.1 97.9 NS
1990 96.1 102.1 99.5 98.6 100.3 96.6 99.1 94.1
1991 96.7 98.6 98.1 96.9 99.0 98.3 98.8 98.1
1992 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
1993 100.2 100.7 100.2 102.7 102.8 102.0 102.6 99.5
1994 100.5 102.3 100.6 107.0 107.2 104.6 106.4 98.3
1995 100.5 101.5 100.3 109.6 109.9 108.0 109.3 » 99.1
1996. 102.6 101.3 101.3 113.4 112.0 112.0 112.0 101.3

See footnotes following table 6.

Source: Bureau of Labor Statistics



Table 4. Private business sector: Productivity and related measures, 1948-96

16

Percent Change
Productivity Inputs
Output per | Output Combined | Capital per
hour of all | per unit Multifactor 53 Labor Capital | units of abe hour of all
Year | person | of capital | Productivity” | Output’ | Input’ | Services” | and capital’ persons
1949 35 “2.7 12 -0.2 33 2.6 -14 6.4
1950 88 59 72 10.1 2.0 3.9 26 27
1951 3.1 11 22 6.4 34 5.2 41 2.0
1952 2.2 <li 09 22 03 33 13 33
1953 34 15 23 46 19 31 22 19
1954 24 33 O1 12 28 2.2 13 6.0
1955 46 5.0 46 85 39 34 37 0.3
1956 03 17 0.4 18 17 3.6 23 21
1957 3.2 -13 15 16 -ld 3.0 OL 46
1958 28 39 04 -2.0 43 2.0 2.4 10
1959 29 45 33 mW 42 25 3.6 AS
1960 17 -1.2 0s 17 05 29 13 29
1961 3.6 05 19 19 -L1 24 0.0 41
1962 47 33 3.6 65 27 3.1 28 14
1963 3.9 1.0 28 4s 08 34 1.6 29
1964 46 25 39 64 17 3.8 24 21
1965 35 21 3.1 10 33 49 38 14
1966, 40 09 3.0 67 2.6 58 3.6 31
1967 22 -3.7 02 19 0.2 58 17 6.1
1968 35 01 2.6 5.0 12 5.0 24 35
1969 05 -2.0 0.5 3.0 29 51 3.6 25
1970 21 45 -0.2 0.1 17 46 0.1 69
1971 43 -03 3.1 39 0.7 42 07 46
1972 33 22 29 68 34 45 37 Wd
1973 32 16 29 10 35 53 41 16
1974 1.6 6.5 -3.6 -16 07 52 2.0 52
1975 35 45 09 “Ll 44 3.6 -2.0 84
1976 35 37 38 68 2.9 29 29 02
1977 16 21 18 57 4.0 3.6 39 0.4
1978 11 16 12 6.1 $1 44 48 0.5
1979 -0.5 “17 -0.6 29 31 4d 3.6 13
1980 04 63 2.4 13 -0.6 53 1 63
1981 19 23 01 2.6 14 5.0 25 42
1982 03 6.8 1 3.0 17 4d 0.1 7.0
1983 31 17 23 5.0 23 32 2.6 13
1984 26 42 3.0 8.6 6.0 43 54 “15
1985 18 08 39 24 46 3.1 25
1986 27 12 33 11 41 21 35
1987 0.0 -03 3.0 33 34 33 04
1988 0.6 02 3.9 40 29 37 03
1989 09 05 34 3.0 28 29 02
1990 07 -0.4 08 0.6 2.6 1.2 25
1991 0.6 14 18 -13 18 03 42
1992 34 20 3.2 1.0 18 13 20
1993 02 02 27 28 20 26 05
1994 04 04 42 43 25 37 12
1995 0.0 0.3 24 25 3.2 27 08
1996 2.0 1.0 3.5 19 37 25 22

See footnotes following table 6.

Source: Bureau of Labor Statistics