For release 10:00 am (EDT) Friday, June 28, 2013 USDL-13-1245

Technical information: (202) 691-5606 • mfpweb@bls.gov • www.bls.gov/mfp 

Media contact: (202) 691-5902 • PressOffice@bls.gov 

(Note: Multifactor productivity data for the private business and private nonfarm business sectors are incorrect for 2012. 

Measures for capital services were incorrectly calculated, affecting measures of multifactor productivity, output per unit of 

capital services, combined inputs, capital services per hour, and the contribution of capital intensity. Only data for 2012 are 

affected--measures for all other years are correct. A corrected news release will be published as soon as possible.) 

PRELIMINARY MULTIFACTOR PRODUCTIVITY TRENDS - 2012

Private nonfarm business sector multifactor productivity increased at a 1.4 percent annual rate in 2012, the 

U.S. Bureau of Labor Statistics reported today. (See chart 1, table A.) The multifactor productivity gain in 2012 

reflected a 2.9 percent increase in output and a 1.5 percent increase in the combined inputs of capital and labor. 

Capital services grew by 0.5 percent and labor input – which is the combined effect of hours worked and labor 

composition – grew by 2.1 percent. Capital services per hour of all persons decreased at a rate of 1.3 percent in 

2012 after falling 1.2 percent in 2011. The decreases in 2011 and 2012 are the only two years of decline in the 

measure which began in 1987. (See table 1.) 

Multifactor productivity measures the change in output per unit of combined capital and labor input. It is designed 

to measure the joint influences of technological change, efficiency improvements, returns to scale, reallocation of 

resources, and other factors on economic growth, allowing for the effects of capital and labor. Multifactor 

productivity, therefore, differs from labor productivity (output per hour worked) measures that are published 

quarterly by BLS. Multifactor productivity includes information on capital services, hours worked, and shifts in 

the composition of labor. Estimates of capital services and labor composition are not included in the quarterly 

labor productivity measures. Additionally, much of the source data needed to construct multifactor productivity 

measures are not available quarterly. 

Private business sector multifactor productivity also grew by 1.4 percent in 2012. A 2.8 percent increase in 

output and a 1.4 percent increase in the combined inputs of capital and labor contributed to the multifactor 

productivity gain in 2012. (See table 2.)

Chart 1. Output per hour of all persons, multifactor productivity, and output per unit of capital services in 

the private nonfarm business sector, 2000-2012 

 

 Annual percent change

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Output per hour of all persons Multifactor productivity Output per unit of capital services
Historical trends in the private nonfarm business sector 

Multifactor productivity in the private nonfarm business sector grew 0.9 percent annually from 1987 to 2012. (See 

table A.) For the 2007-2012 period, multifactor productivity grew 0.6 percent as combined inputs decreased 0.1 

percent and output increased 0.5 percent. The small decline in combined inputs reflected a decrease in labor input 

of 0.7 percent combined with a 1.0 percent increase in capital services. In 2012, the 1.5 percent increase in 

combined inputs was a result of 2.1 percent growth in labor input combined with a 0.5 percent increase in capital 

services. This was the third straight year where labor input grew faster than capital services. (See table 1.) 

Annual labor productivity growth can be viewed as the sum of three components: multifactor productivity growth, 

the contribution of capital intensity, and the contribution of shifts in labor composition. Output per hour shifted 

sharply upwards after the 1990-1995 period reflecting increases in contribution of capital intensity and multifactor 

productivity. 

For the 2007-2012 period, the contribution of capital intensity and the contribution of labor composition 

amounted to 0.7 percent and 0.3 percent, respectively. Additionally, the growth in multifactor productivity of 0.6 

percent contributed to an overall growth of output per hour of 1.7 percent. This composition of labor productivity 

growth more closely resembles the 1990-1995 period, prior to the upward shift in multifactor productivity and 

capital intensity. (See chart 2, table B.) 

In 2012, the contribution of capital intensity in the private nonfarm business sector declined 0.5 percent. 

Combined with a modest 0.1 percent increase in the contribution of labor composition and a 1.4 percent increase 

in multifactor productivity, output per hour of all persons increased at a 1.0 percent annual rate. Labor 

productivity growth was much smaller than the average increase of 2.1 percent over the duration of the series, 

from 1987 to 2012. (See table B.) 

The methodology for measuring preliminary multifactor productivity for 2012 is a simplified version of the 

methodology that BLS uses when more detailed data are available. Measures will be revised in early 2014.

Chart 2. Percentage point contributions to growth in output per hour in the private nonfarm business 

sector, 1987-2012 

 Percentage point

Note: Multifactor productivity plus the contributions of capital intensity and labor composition may not sum to 

output per hour due to independent rounding. 

0.8 0.6 0.6

1.2 1.0

0.7

0.3

0.4 0.5

0.2

0.2

0.3

0.9

0.5 0.5

1.3

1.4

0.6

0.0

0.5

1.0

1.5

2.0

2.5

3.0

1987-2012 1987-1990 1990-1995 1995-2000 2000-2007 2007-2012

Contribution of capital intensity Contribution of labor composition Multifactor productivity
Table A. Compound annual growth rates for productivity, output, and inputs in the private nonfarm 

business and private business sectors for selected periods, 1987-2012

In percent 

1987-

2012

1987-

1990

1990-

1995

1995-

2000

2000-

2007

2007-

2012

2011-

2012

Private nonfarm business1

Productivity

 Multifactor Productivity20.9 0.5 0.5 1.3 1.4 0.6 1.4

 Output per hour of all persons 2.1 1.4 1.6 2.7 2.6 1.7 1.0

 Output per unit of capital services -0.6 -0.4 -0.4 -1.0 -0.5 -0.5 2.4

Output 2.8 3.2 2.9 5.0 2.7 0.5 2.9

Inputs

 

 Combined inputs31.8 2.7 2.4 3.6 1.3 -0.1 1.5

 Labor Input41.1 2.3 2.0 2.5 0.4 -0.7 2.1

 Hours 0.7 1.7 1.3 2.2 0.1 -1.2 1.9

 Labor composition50.5 0.6 0.7 0.3 0.3 0.5 0.1

 Capital services 3.4 3.6 3.3 6.0 3.2 1.0 0.5

Analytic ratio

 Capital services per hour of all 

 persons 2.7 1.8 1.9 3.8 3.1 2.2 -1.3

Private business1

Productivity

 Multifactor Productivity21.0 0.6 0.4 1.5 1.4 0.6 1.4

 Output per hour of all persons 2.1 1.6 1.5 2.9 2.7 1.7 0.9

 Output per unit of capital services -0.5 -0.3 -0.3 -0.8 -0.5 -0.4 2.4

Output 2.8 3.2 2.8 5.0 2.7 0.5 2.8

Inputs

 

 Combined inputs31.8 2.6 2.4 3.4 1.2 -0.1 1.4

 Labor Input41.1 2.1 2.0 2.4 0.3 -0.7 2.0

 Hours 0.6 1.6 1.3 2.0 0.0 -1.1 1.9

 Labor composition50.5 0.6 0.7 0.3 0.3 0.5 0.1

 Capital services 3.3 3.5 3.1 5.8 3.1 0.9 0.4

Analytic ratio

 Capital services per hour of all 

 persons 2.6 1.9 1.8 3.7 3.1 2.1 -1.5

1 Excludes government enterprises. 

2 Output per combined units of labor input and capital services. 

3 The growth rate of each input is weighted by its share of current dollar costs.

4 Hours at work by age, education, and gender group are weighted by each group’s share of the total wage bill. 

5 Ratio of labor input to hours. 
- 4 - 

Table B. Compound annual growth rates in output per hour of all persons and the contribution of 

capital intensity, labor composition, and multifactor productivity in the private nonfarm business and 

private business sectors for selected periods, 1987-2012 

In percent 

1987-

2012

1987-

1990

1990-

1995

1995-

2000

2000-

2007

2007-

2012

2011-

2012

Private nonfarm business1

Output per hour of all persons 2.1 1.4 1.6 2.7 2.6 1.7 1.0

 Contribution of capital 

 intensity20.8 0.6 0.6 1.2 1.0 0.7 -0.5

 Contribution of labor 

 composition30.3 0.4 0.5 0.2 0.2 0.3 0.1

 Multifactor productivity4 0.9 0.5 0.5 1.3 1.4 0.6 1.4

Private business1

Output per hour of all persons 2.1 1.6 1.5 2.9 2.7 1.7 0.9

 Contribution of capital 

 intensity20.8 0.6 0.6 1.2 1.0 0.7 -0.5

 Contribution of labor 

 composition30.3 0.4 0.5 0.2 0.2 0.3 0.1

 Multifactor productivity4

1.0 0.6 0.4 1.5 1.4 0.6 1.4

 1 Excludes government enterprises.

 2 Capital services per hour multiplied by capital's share of current dollar costs.

 3 Labor composition multiplied by labor's share of current dollar costs.

 4 Output per combined units of labor input and capital services.

Note: Multifactor productivity plus the contributions of capital intensity and labor composition may not sum to 

output per hour due to independent rounding. 
- 5 - 

Technical Notes 

The simplified methodology for preparing preliminary estimates of MFP is outlined in the June 2005 

Monthly Labor Review article, “Preliminary estimates of multifactor productivity growth” located at 

http://www.bls.gov/opub/mlr/2005/06/art3full.pdf. This methodology is applied to both the private 

nonfarm business and private business sectors and measures are calculated only for the most recent year. 

Data for all previous years are identical to the April 9, 2013 “Multifactor Productivity Trends” news 

release (USDL-13-0626).

Capital Services 

Capital services are the services derived from the stock of physical assets and software. Capital services 

measures constructed for the preliminary MFP measures are based on less detail only for the most recent 

year. The preliminary measures consist of eight asset types as opposed to the 86 asset types for fixed 

business equipment and software, structures, inventories, and land included in estimates for all previous 

years. The assets included in the preliminary estimates are computers, software, communications and 

other information processing equipment, other fixed business equipment, structures, inventories, rental 

residences, and land. Investments, depreciation, and capital income are estimated for each of these eight 

aggregates. Capital services are calculated by a chained superlative Tornqvist index combining stocks of 

the eight asset categories, weighted by capital income shares. 

Labor Input 

Labor input in private business and private nonfarm business is obtained by chained superlative 

Tornqvist aggregation of the hours at work by all persons, classified by age, education, and gender with 

weights determined by each group’s share of the total wage bill. The preliminary estimates of 2012 

hours worked for the private nonfarm business and private business sectors are extrapolated from the 

hours worked reported in the nonfarm business and business sectors, respectively, in the February 7, 

2013 “Productivity and Costs” news release (USDL-13-0192). 

The labor composition index estimates the effect of shifts in the age, education, and gender composition 

of the work force on the efficiency of hours worked. The preliminary MFP labor composition measure 

estimates the number of hours worked by each type of worker based on Current Population Survey 

(CPS) data. The estimate of the 2012 labor composition index assumes relative wages across groups 

remain constant between 2011 and 2012.

Additional information concerning data sources and methods of measuring labor composition can be 

found in Cindy Zoghi, 2007, “Measuring Labor Composition: A Comparison of Alternate 

Methodologies” http://www.bls.gov/bls/fesacp1121407.pdf and in “Changes in the Composition of 

Labor for BLS Multifactor Productivity Measures” http://www.bls.gov/mfp/mprlabor.pdf. 

Combined Inputs 

Labor input and capital services are combined using chained superlative Tornqvist aggregation, applying 

weights that represent each component's share of total costs. The chained superlative Tornqvist index 

uses changing weights; the share in each year is averaged with the preceding year's share. Total costs are 

defined as the value of output less a portion of taxes on production and imports. Most taxes on 

production and imports, such as excise taxes, are excluded from costs; however, property and motor 

vehicle taxes remain in total costs. 
- 6 - 

Capital Intensity

Capital intensity is the ratio of capital services to hours worked in the production process. The higher the 

capital to hours ratio, the more capital intensive the production process is. 

In a production process, profit maximizing/cost-minimizing firms adjust the factor proportions of capital 

and labor if the price of one factor is less than the other factor; there would be a tendency for the firms to 

substitute the less expensive factor for the more expensive one. In the short run, changes in hours 

worked are more variable than changes in capital services. Changes in hours worked in business cycles 

can result in volatility of the capital intensity ratio over short periods of time. In the long run an increase 

in wages relative to the price of capital will induce the firm to substitute capital for labor, resulting in an 

increase in capital intensity. 

Output

Private business sector output is a chain-type, current-weighted index constructed after excluding from 

gross domestic product (GDP) the following outputs: general government, nonprofit institutions, private 

households (including owner-occupied housing), and government enterprises. This release presents data 

for the private business and private nonfarm business sectors. The private business sector accounted for 

approximately 74 percent of gross domestic product in 2011. Additionally, the private nonfarm business 

sector excludes farms from the private business sector, but includes agricultural services. Multifactor 

measures exclude government enterprises, while the BLS quarterly Productivity and Cost series include 

them. The output measures are based on the National Income and Product Accounts (NIPA) data 

released by the Bureau of Economic Analysis (BEA) on January 30, 2013 but do not reflect the revised 

data released by BEA on February 28, 2013. The preliminary estimates of 2012 output for the private 

nonfarm business and private business sectors are extrapolated from the output reported in the nonfarm 

business and business sectors, respectively, in the February 7, 2013 “Productivity and Costs” news 

release (USDL-13-0192).

Multifactor Productivity

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 or capital, or any 

other factor of production. Rather, multifactor productivity is designed to measure the joint influences of 

technological change, efficiency improvements, returns to scale, reallocation of resources, and other 

factors on economic growth, allowing for the effects of capital and labor. 

The multifactor productivity indexes for private business and private nonfarm business are derived by 

dividing an output index by an index of capital services and labor input. The output indexes are 

computed as chained superlative indexes (Fisher Ideal indexes) of components of real output.
- 7 - 

Table 1. Private nonfarm business sector: productivity and related measures for the 1987-20121 period

Annual percent change from previous year 

Productivity Inputs

Year

Output 

per hour 

of all 

persons

Output 

per unit 

of 

capital

services

Multifactor 

Productivity2 Output3

Labor

Input4

Capital

Services5

Combined 

units of 

labor input 

and 

capital

services6

Capital 

services

per hour 

of all 

persons

1988 1.7 0.9 1.0 4.6 3.5 3.6 3.5 0.7

1989 0.8 -0.4 0.0 3.5 3.3 3.9 3.5 1.1

1990 1.9 -1.7 0.4 1.4 0.1 3.2 1.1 3.7

1991 1.7 -3.6 -1.0 -0.9 -1.1 2.8 0.1 5.5

1992 4.0 1.5 2.3 3.8 1.0 2.3 1.4 2.5

1993 0.6 0.4 0.3 3.6 3.3 3.2 3.3 0.3

1994 1.1 1.1 0.7 4.7 4.1 3.6 3.9 0.0

1995 0.5 -1.1 0.0 3.3 2.7 4.4 3.2 1.6

1996 2.6 -0.3 1.4 4.4 2.2 4.8 3.0 2.9

1997 1.5 -0.4 0.6 5.1 4.0 5.5 4.5 1.9

1998 2.9 -1.2 1.5 5.2 2.4 6.4 3.6 4.2

1999 3.3 -1.2 1.7 5.6 2.6 6.9 3.9 4.5

2000 3.4 -2.0 1.6 4.5 1.2 6.5 2.8 5.5

2001 3.1 -3.6 0.7 1.0 -1.6 4.8 0.3 7.0

2002 4.7 -1.3 2.4 1.9 -2.0 3.3 -0.4 6.0

2003 3.8 0.5 2.5 3.1 -0.4 2.7 0.6 3.3

2004 2.6 1.5 2.4 4.0 1.2 2.5 1.6 1.1

2005 1.6 0.4 1.1 3.4 2.0 3.0 2.3 1.2

2006 0.9 -0.1 0.4 3.2 2.5 3.3 2.8 1.0

2007 1.7 -0.8 0.3 2.2 1.2 3.0 1.8 2.5

2008 0.7 -4.0 -1.4 -1.5 -1.5 2.7 -0.1 4.9

2009 3.1 -5.2 -0.4 -4.4 -6.5 0.8 -4.0 8.8

2010 3.1 2.8 2.6 3.1 0.6 0.3 0.5 0.3

2011 0.7 1.9 1.0 2.7 2.2 0.8 1.7 -1.2

2012 1.0 2.4 1.4 2.9 2.1 0.5 1.5 -1.3

See footnotes following table 4. Source: Bureau of Labor Statistics 
- 8 - 

Table 2. Private business sector: productivity and related measures for the 1987-20121 period

Annual percent change from previous year 

Productivity Inputs

Year

Output 

per hour 

of all 

persons

Output 

per unit 

of 

capital

services

Multifactor 

Productivity2 Output3

Labor

Input4

Capital

Services5

Combined 

units of 

labor input 

and 

capital

services6

Capital 

services 

per hour 

of all 

persons

1988 1.5 0.5 0.8 4.3 3.4 3.8 3.5 1.0

1989 1.0 -0.1 0.3 3.7 3.2 3.9 3.4 1.2

1990 2.2 -1.4 0.6 1.5 -0.1 3.0 0.9 3.6

1991 1.6 -3.4 -1.0 -0.8 -1.0 2.7 0.2 5.2

1992 4.2 1.8 2.6 4.0 1.0 2.1 1.4 2.3

1993 0.6 0.2 0.2 3.3 3.1 3.1 3.1 0.4

1994 0.9 1.4 0.7 5.0 4.5 3.5 4.2 -0.4

1995 0.1 -1.3 -0.3 2.9 2.7 4.3 3.2 1.4

1996 2.9 0.0 1.7 4.6 2.0 4.6 2.8 2.9

1997 1.8 -0.1 0.8 5.2 3.9 5.3 4.4 1.8

1998 3.0 -1.1 1.5 5.0 2.3 6.2 3.5 4.1

1999 3.5 -1.0 1.8 5.6 2.4 6.7 3.7 4.5

2000 3.5 -1.7 1.7 4.6 1.2 6.3 2.8 5.3

2001 3.2 -3.5 0.8 0.9 -1.8 4.6 0.1 7.0

2002 4.6 -1.2 2.4 2.0 -1.9 3.2 -0.4 5.8

2003 3.9 0.6 2.7 3.2 -0.4 2.6 0.5 3.3

2004 2.8 1.4 2.4 4.1 1.1 2.6 1.6 1.3

2005 1.7 0.3 1.0 3.5 2.0 3.2 2.4 1.4

2006 1.0 -0.1 0.4 3.1 2.4 3.2 2.7 1.0

2007 1.6 -0.7 0.3 2.1 1.2 2.8 1.7 2.3

2008 0.7 -3.7 -1.2 -1.3 -1.4 2.4 -0.1 4.6

2009 3.2 -4.8 -0.1 -4.2 -6.5 0.6 -4.1 8.5

2010 3.0 2.7 2.5 3.0 0.7 0.3 0.5 0.3

2011 0.4 1.4 0.7 2.4 2.1 1.0 1.7 -1.0

2012 0.9 2.4 1.4 2.8 2.0 0.4 1.4 -1.5

See footnotes following table 4. Source: Bureau of Labor Statistics 
- 9 - 

Table 3. Private nonfarm business sector: indexes of productivity and related measures, 1987-20121

Indexes 2005=100 

Productivity Inputs

Year

Output 

per hour 

of all 

persons

Output 

per unit 

of 

capital

services

Multifactor 

Productivity2 Output3

Labor

Input4

Capital

Services5

Combined 

units of 

labor input 

and 

capital

services6

Capital 

services 

per hour 

of all 

persons

1987 66.3 111.1 82.3 54.2 75.5 48.8 65.9 59.6

1988 67.4 112.2 83.1 56.7 78.2 50.6 68.3 60.0

1989 67.9 111.8 83.1 58.7 80.8 52.6 70.7 60.7

1990 69.2 109.9 83.5 59.6 80.8 54.2 71.4 62.9

1991 70.3 105.9 82.7 59.1 79.9 55.8 71.5 66.4

1992 73.1 107.5 84.6 61.3 80.7 57.0 72.5 68.0

1993 73.6 107.9 84.8 63.5 83.4 58.9 74.9 68.2

1994 74.4 109.1 85.5 66.5 86.9 61.0 77.8 68.2

1995 74.7 107.9 85.5 68.7 89.2 63.7 80.3 69.3

1996 76.7 107.5 86.7 71.7 91.1 66.7 82.8 71.3

1997 77.8 107.1 87.2 75.4 94.8 70.4 86.5 72.6

1998 80.1 105.9 88.4 79.3 97.1 74.9 89.7 75.7

1999 82.7 104.6 89.9 83.8 99.6 80.1 93.2 79.1

2000 85.6 102.6 91.4 87.5 100.8 85.3 95.8 83.4

2001 88.3 98.9 92.0 88.4 99.2 89.3 96.0 89.2

2002 92.4 97.6 94.2 90.1 97.2 92.3 95.6 94.6

2003 95.8 98.1 96.6 92.9 96.9 94.7 96.2 97.7

2004 98.4 99.6 98.9 96.7 98.1 97.1 97.7 98.8

2005 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

2006 100.9 99.9 100.4 103.2 102.5 103.3 102.8 101.0

2007 102.6 99.1 100.7 105.4 103.8 106.4 104.7 103.6

2008 103.3 95.1 99.3 103.9 102.2 109.3 104.6 108.6

2009 106.5 90.1 98.9 99.3 95.6 110.2 100.4 118.2

2010 109.8 92.7 101.5 102.3 96.2 110.4 100.9 118.5

2011 110.6 94.4 102.5 105.1 98.3 111.4 102.6 117.1

2012 111.6 96.6 103.9 108.2 100.3 111.9 104.1 115.5

See footnotes following table 4. Source: Bureau of Labor Statistics 
- 10 - 

Table 4. Private business sector: indexes of productivity and related measures, 1987-20121

Indexes 2005=100 

Productivity Inputs

Year

Output 

per hour 

of all 

persons

Output 

per unit 

of 

capital

services

Multifactor 

Productivity2 Output3

Labor

Input4

Capital

Services5

Combined 

units of 

labor input 

and 

capital

services6

Capital 

services 

per hour 

of all 

persons

1987 65.4 109.0 81.3 54.2 76.4 49.7 66.6 60.0

1988 66.4 109.6 82.0 56.5 78.9 51.6 69.0 60.6

1989 67.1 109.4 82.2 58.6 81.5 53.6 71.3 61.3

1990 68.6 107.9 82.7 59.5 81.4 55.2 72.0 63.6

1991 69.7 104.2 81.9 59.1 80.5 56.7 72.1 66.9

1992 72.6 106.1 84.0 61.4 81.4 57.9 73.1 68.4

1993 73.1 106.4 84.2 63.4 83.9 59.7 75.3 68.7

1994 73.8 107.8 84.8 66.6 87.7 61.8 78.5 68.4

1995 73.8 106.4 84.6 68.5 90.0 64.4 81.0 69.4

1996 76.0 106.4 86.0 71.7 91.8 67.3 83.3 71.4

1997 77.3 106.4 86.7 75.4 95.4 70.9 86.9 72.7

1998 79.6 105.2 88.0 79.2 97.6 75.3 90.0 75.7

1999 82.4 104.1 89.6 83.6 99.9 80.3 93.3 79.1

2000 85.3 102.4 91.2 87.4 101.1 85.4 95.9 83.3

2001 88.0 98.8 91.9 88.3 99.3 89.3 96.0 89.1

2002 92.1 97.7 94.1 90.0 97.4 92.1 95.7 94.3

2003 95.7 98.3 96.6 92.9 97.0 94.5 96.1 97.4

2004 98.4 99.7 99.0 96.7 98.1 96.9 97.7 98.6

2005 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

2006 101.0 99.9 100.4 103.1 102.4 103.2 102.7 101.0

2007 102.6 99.2 100.8 105.2 103.6 106.1 104.4 103.4

2008 103.3 95.6 99.5 103.8 102.1 108.7 104.3 108.1

2009 106.6 91.0 99.4 99.5 95.5 109.4 100.1 117.3

2010 109.9 93.4 101.8 102.5 96.1 109.7 100.6 117.6

2011 110.3 94.8 102.5 105.0 98.2 110.8 102.4 116.4

2012 111.3 97.1 104.0 107.9 100.2 111.2 103.8 114.7

See footnotes following table 4. Source: Bureau of Labor Statistics
- 11 - 

Footnotes, Tables 1-4

Source: The Bureau of Labor Statistics (BLS) develops productivity measures using output and 

compensation data published by the Bureau of Economic Analysis (BEA), hours data published by other 

BLS programs, and capital data supplied by BEA and U.S. Department of Agriculture. Also see 

Technical Notes in this release. 

(1) The private business sector covers gross domestic product with the exception of 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 further excludes farms but includes agricultural services. 

(2) Output per combined units of labor input and capital services. 

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

(4) Index of hours at work of all persons including employees, proprietors, and unpaid family 

workers, classified by age, education, and gender. This chained superlative 

index is computed by combining changes in the hours of each age, education, and gender group 

weighted by each group’s share of the total wage bill. 

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

 derived from the stock of physical assets and software. The assets included are fixed business 

 equipment, structures, inventories, and land.

(6) The growth rates of labor input and capital services are combined by weighting with their respective 

 shares of current dollar costs, and aggregating into a chained superlative index.