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                              PRODUCTIVITY AND COSTS
                              First Quarter 2007, Revised
                              
                              
   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 first quarter of 2007.  The revised seasonally adjusted 
annual rates of productivity change in the first quarter were:

                  0.5 percent in the business sector and
                  1.0 percent in the nonfarm business sector.
    
In both sectors, the first-quarter productivity gains were smaller than the 
preliminary estimates reported on May 3, due to downward revisions to output 
growth.

   In manufacturing, the revised productivity changes in the first quarter 
were:

                  2.4 percent in manufacturing,
                  2.2 percent in durable goods manufacturing, and
                  1.8 percent in nondurable goods manufacturing.
                     
   Manufacturing productivity growth was slower in the first quarter of 
2007 than reported on May 3, reflecting downward revisions to output per hour 
in both durable goods and nondurable goods industries.  Output and hours in 
manufacturing, which includes about 12 percent of U.S. business-sector 
employment, tend to vary more from quarter to quarter than data for the 
aggregate business and nonfarm business sectors.  First-quarter measures are 
summarized in table A and appear in detail in tables 1 through 5.  

   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 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 first-quarter 2007 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                 0.5        0.4      -0.1      2.5     -1.4      1.9
Nonfarm business         1.0        0.6      -0.4      2.8     -1.0      1.8
Manufacturing            2.4        1.2      -1.1      6.9      3.0      4.5
  Durable                2.2       -0.4      -2.5      8.5      4.5      6.2
  Nondurable             1.8        3.1       1.3      4.3      0.4      2.4
------------------------------------------------------------------------------  
                              Percent change from same quarter a year ago
                              
Business                 0.7        2.0       1.3      3.0      0.5      2.2
Nonfarm business         1.0        2.0       1.1      3.2      0.7      2.2
Manufacturing            3.5        2.4      -1.1      3.1      0.6     -0.4
  Durable                4.8        3.2      -1.5      4.2      1.7     -0.5
  Nondurable             1.8        1.4      -0.3      1.0     -1.4     -0.7
------------------------------------------------------------------------------  
  
  
Business

   Productivity rose 0.5 percent in the business sector from the fourth 
quarter of 2006 to the first quarter of 2007, as output increased 0.4 percent 
and hours worked by all persons declined 0.1 percent (seasonally adjusted 
annual rates). In the fourth quarter of 2006, output per hour increased 1.5 
percent, reflecting increases in output and hours of 2.9 percent and 1.4 
percent, respectively (table 1).  From first-quarter 2006 to first-quarter 
2007, business sector productivity posted the smallest four-quarter gain 
since the fourth quarter of 1995, when it also rose 0.7 percent.

   Hourly compensation increased at a 2.5 percent annual rate in the first 
quarter of 2007.  For the fourth quarter of 2006, hourly compensation growth 
was revised up to 10.4 percent from the 7.7-percent increase reported May 3.  
This measure of 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, declined 
1.4 percent in the first quarter of 2007 following a 12.8-percent gain in the 
previous quarter. 

   The change in unit labor costs approximates the change in hourly 
compensation less the change in productivity, and in the first quarter of 
2007 there was a 1.9-percent rise in these costs.  Unit labor costs grew 8.8 
percent per year in the fourth quarter of 2006, as revised.  The implicit 
price deflator for business output, which reflects changes in both unit labor 
costs and unit nonlabor payments, grew by 3.7 percent in the first quarter of 
2007.


Nonfarm business

   Productivity increased 1.0 percent in the nonfarm business sector during 
the first quarter of 2007, as output rose 0.6 percent and hours of all 
persons fell 0.4 percent (seasonally-adjusted annual rates).  The decline in 
nonfarm business hours worked was the first since 2003, when hours fell 2.1 
percent in the first quarter and 1.3 percent in the second quarter.  In 
fourth-quarter 2006, nonfarm productivity had increased 2.1 percent as output 
increased 2.9 percent and hours rose 0.8 percent (table 2).  The 1.0-percent 
increase in output per hour since the first quarter of 2006 is small compared 
to recent movements.  Nonfarm business productivity had increased at an 
average annual rate of 3.1 percent from 2000 through 2005.

   Hourly compensation increased 2.8 percent in the nonfarm business sector 
in the first quarter of 2007.  This measure had increased 11.2 percent in the 
fourth quarter of 2006, as revised.  When the rise in consumer prices is 
taken into account, real hourly compensation grew 13.6 percent in the fourth 
quarter of 2006, then declined 1.0 percent in the first quarter of 2007.

   Unit labor costs rose 1.8 percent during the first quarter of 2007, 
following an 8.9-percent increase in the fourth quarter of 2006, as revised. 
The implicit price deflator for nonfarm business output rose by 3.2 percent 
in the first quarter of 2007.


Manufacturing

   Productivity grew at a 2.4-percent annual rate in the manufacturing 
sector during the first quarter of 2007, the joint effect of a 1.2-percent 
increase in output and a 1.1-percent decrease in hours.  The 2.2-percent 
productivity gain in durable goods industries in the first quarter was due 
entirely to a 2.5-percent drop in hours worked, as output also declined, by 
0.4 percent.  Output per hour rose 1.8 percent in nondurable goods industries 
as output and hours both increased, by 3.1 percent and 1.3 percent, 
respectively (tables 3, 4, and 5).

   Hourly compensation in manufacturing grew 6.9 percent during the first 
quarter of 2007, following a gain of 11.8 percent one quarter earlier, as 
revised.  Hourly compensation rose 8.5 percent in durable goods industries 
and 4.3 percent in nondurable goods industries.  Real hourly compensation, 
which takes into account changes in consumer prices, increased 3.0 percent 
for all manufacturing workers, as a 4.5-percent rise in durable manufacturing 
real hourly compensation combined with a 0.4-percent rise in the nondurable 
goods industries.

   Unit labor costs rose 4.5 percent in manufacturing during the first 
quarter of 2007.    In durable goods industries, where hourly compensation 
increased much faster than productivity, unit labor costs increased 6.2 
percent.  In nondurable goods industries, unit labor costs rose 2.4 percent 
during the first quarter of 2007, but when the first quarter of 2007 is 
compared to the first quarter of 2006 nondurable manufacturing unit labor 
costs declined 0.7 percent.


Nonfinancial corporations

   Preliminary first-quarter 2007 measures of productivity and costs for 
nonfinancial corporations also were announced today (tables B and 6).  
Productivity rose 0.6 percent in the first quarter, as output increased 0.7 
percent and employee-hours edged up 0.1 percent (seasonally adjusted annual 
rates).  The 0.3-percent increase in output per hour from the first quarter 
of 2006 to the first quarter of 2007 was the smallest gain since a similar 
increase from the fourth quarter of 1992 to the fourth quarter of 1993.   The 
nonfinancial corporate sector includes 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 first-quarter 2007
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
                     
2007 I    0.6      0.7     0.1      4.7      0.8      4.1      6.8      3.7
------------------------------------------------------------------------------
                     Percent change from same quarter a year ago
                     
2007 I    0.3      1.6     1.2      3.4      0.9      3.0     -1.9      2.0
------------------------------------------------------------------------------


   Hourly compensation rose 4.7 percent during the first quarter of 2007, 
following an 8.7- percent increase in the fourth quarter of 2006.  Taking the 
3.9-percent rise in consumer prices  into account, real hourly compensation 
increased 0.8 percent in the first quarter of 2007, in contrast to fourth-
quarter 2006 when real hourly compensation jumped 11.0 percent.  Unit labor 
costs in nonfinancial corporations rose 4.1 percent in the first quarter of 
2007.


REVISED MEASURES

   Previous and revised measures for the first quarter of 2007 in the 
business, nonfarm business, and manufacturing sectors are compared in table 
C.  Productivity growth was revised down in all sectors due to downward 
revisions to output growth.  Increases in hourly compensation and unit labor 
costs were revised up in all sectors for the first quarter of 2007 when 
compared to preliminary estimates reported May 3.


------------------------------------------------------------------------------
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
------------------------------------------------------------------------------
                                    First quarter 2007
   
Business:                  
  Previous               1.3        1.2      0.0      1.9      -1.9        0.7
  Revised                0.5        0.4     -0.1      2.5      -1.4        1.9
Nonfarm business:                      
  Previous               1.7        1.4     -0.3      2.3      -1.5        0.6
  Revised                1.0        0.6     -0.4      2.8      -1.0        1.8
Manufacturing:                
  Previous               2.7        1.5     -1.1      5.5       1.6        2.7
  Revised                2.4        1.2     -1.1      6.9       3.0        4.5

                                    Fourth quarter 2006
   
Business:                  
  Previous               1.5        2.9      1.4      7.7      10.0        6.2
  Revised                1.5        2.9      1.4     10.4      12.8        8.8
Nonfarm business:                      
  Previous               2.1        2.9      0.8      8.5      10.8        6.2
  Revised                2.1        2.9      0.8     11.2      13.6        8.9
Manufacturing:                
  Previous               1.9       -2.1     -3.9      6.6       8.9        4.6
  Revised                1.9       -2.1     -3.9     11.8      14.2        9.8
  
                                    Annual average 2006
   
Business:                  
  Previous               1.7        3.8      2.1      4.8       1.5        3.1
  Revised                1.7        3.8      2.1      5.0       1.6        3.2
Nonfarm business:                      
  Previous               1.6        3.8      2.1      4.8       1.5        3.1
  Revised                1.6        3.8      2.1      5.0       1.6        3.3
Manufacturing:                
  Previous               4.0        5.0      1.0      3.7       0.4       -0.2
  Revised                4.0        5.0      1.0      4.1       0.7        0.1
------------------------------------------------------------------------------


   Table C also presents preliminary and revised results for the fourth 
quarter and annual average of 2006.  Only hourly compensation and related 
measures were revised; productivity, output, and hours were not.  These 
revisions resulted from incorporation of revised data on employee 
compensation from the Bureau of Economic Analysis (BEA) of the U.S. 
Department of Commerce, released May 31.  The BEA compensation estimates 
reflect the introduction of revised wage and salary estimates for the fourth 
quarter.

   In the fourth quarter of 2006, increases in hourly compensation, real 
hourly compensation, and unit labor costs were revised up in all sectors.  
Annual averages of these measures for 2006 were also revised up, and unit 
labor costs in manufacturing now show a small increase rather than a small 
decline for the year.


REVISED MEASURES: NONFINANCIAL CORPORATIONS

   Fourth quarter and annual average 2006 measures were revised for the 
nonfinancial corporate sector.  Productivity increased at a 1.3-percent 
annual rate in the fourth quarter of 2006, reflecting growth in output and 
employee-hours of 2.4 percent and 1.1 percent, respectively.  An upward 
revision to hourly compensation outpaced the revision to productivity, and 
as a result unit labor costs rose slightly faster than reported May 3.  For 
the year 2006, growth in productivity, output, and hours were unchanged.


------------------------------------------------------------------------------
Table D.  Nonfinancial corporations: Previous and revised productivity and 
cost measures
Quarterly percent changes at seasonally adjusted annual rates
------------------------------------------------------------------------------
                                           Real  
                                  Hourly   hourly   Unit              Implicit
         Produc-                  compen-  compen-  labor   Unit      price
         tivity   Output  Hours   sation   sation   costs   profits   deflator
------------------------------------------------------------------------------
                           Fourth quarter 2006
   
Previous    1.0      2.1   1.1      8.2      10.5     7.1   -25.6       0.9
Revised     1.3      2.4   1.1      8.7      11.0     7.3   -25.8       0.9

                           Annual average 2006

Previous    2.5      4.8   2.2      4.7       1.4     2.2    12.2       2.7
Revised     2.5      4.8   2.2      4.8       1.4     2.2    12.2       2.7
------------------------------------------------------------------------------


                              Next release date

   The next release of Productivity and Costs is scheduled for 8:30 AM EDT, 
Tuesday, Aug. 7, 2007.  Preliminary second-quarter measures for business, 
nonfarm business, and manufacturing will be released at that time.  The Aug. 
7 release also will incorporate the three-year revision of the National 
Income and Product Accounts.  




				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 em-
ployment 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.  
Weekly paid hours are adjusted to hours at work using data from the National 
Compensation Survey (NCS).  The BLS Hours at Work survey, conducted for this 
purpose, was used for earlier years.  The Office of Productivity and 
Technology estimates average weekly hours at work for nonproduction and 
supervisory workers using information from the Current Population Survey 
(CPS), the CES, and the NCS.
      Data from the CPS are used for farm labor, nonfarm proprietors, and 
nonfarm unpaid family workers.  Estimates of labor input for government 
enterprises are derived from the CPS, the CES, and the National Income and 
Product Accounts (NIPA) prepared by the Bureau of Economic Analysis (BEA) of 
the Department of Commerce.
      The CES measures jobs, counting a person who is employed by two or more 
establishments at each place of employment. In contrast, the CPS features 
measures of employment that count each person only once and classify each 
person according to his or her primary job; hours worked at all jobs by that 
person accrue to his or her primary job.  However, the CPS also collects more 
detailed information on employment and hours worked at primary jobs and all 
other jobs, separately.  The BLS productivity measures use the more detailed 
information on employment and hours to assign all hours worked to the correct 
industrial sector and avoid duplicating hours data from the CES.

Output: Business sector output is an annual-weighted index constructed after 
excluding from gross domestic product (GDP) the following outputs: general 
government, nonprofit institutions, and private households (including owner-
occupied housing). Corresponding exclusions also are made in labor inputs. 
Business output accounted for about 78 percent of the value of GDP in 2000. 
Nonfarm business, which also excludes farming, accounted for about 77 percent 
of GDP in 2000.
      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 
BLS.  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 3-digit NAICS industries: wood product 
manufacturing; nonmetallic mineral product manufacturing; primary metal 
manufacturing; fabricated metal product manufacturing; machinery manufac-
turing; computer and electronic product manufacturing; electrical equipment 
and appliance manufacturing; transportation equipment manufacturing; 
furniture and related product manufacturing; and miscellaneous manufacturing. 
Nondurables include: food manufacturing; beverage and tobacco product 
manufacturing; textile mills; textile product mills; apparel manufacturing; 
leather and allied product manufacturing; paper manufacturing; printing and 
related support activities; petroleum and coal products manufacturing; 
chemical manufacturing; and plastics and rubber products manufacturing.
      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; private households; unincorporated business; and 
those corporations classified as offices of bank holding companies, offices 
of other holding companies, or offices in the finance and insurance sector. 
Nonfinancial corporations accounted for about 54 percent of the value of GDP 
in 2000.
      
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.

Labor Compensation: Estimates of labor compensation by major sector, required 
for measures of hourly compensation and unit labor costs, are based primarily 
on employee compensation data from the NIPA, prepared by the BEA.   The 
compensation of employees in general government, nonprofit institutions and 
private households are subtracted from compensation of domestic employees to 
derive employee compensation for the business sector. The labor compensation 
of proprietors cannot be explicitly identified and must be estimated.   This 
is done by assuming that proprietors have the same hourly compensation as 
employees in the same sector.  The quarterly labor productivity and cost 
measures do not contain estimates of compensation for unpaid family workers.  
        
Unit Labor Costs:  The measures of unit labor costs in this release describe 
the relationship between compensation per hour and productivity, or real 
output per hour, and can be used as an indicator of inflationary pressure on 
producers.  Increases in hourly compensation increase unit labor costs; labor 
productivity increases offset compensation increases and lower unit labor 
costs. 

Presentation of the data:  The quarterly data in this release are presented 
in three ways; as index number series where 1992=100, as percent changes from 
the corresponding quarter of the previous year, and as percent changes from 
the previous quarter presented at a compound annual rate.  Annual data are 
presented both as index number series and percent changes from the previous 
year.  
	The index numbers and rates of change reported in the productivity and 
costs news release are rounded to one decimal place.  All percent changes in 
this release and on the BLS web site are calculated using index numbers to 
three decimal places.  These index numbers are available at the BLS web site, 
http://www.bls.gov/data/home.htm, or by contacting the BLS Division of Major 
Sector Productivity.  (Telephone 202-691-5606 or email DPRWEB@BLS.GOV)
        
Information in this release will be made available to sensory-impaired 
individuals upon request. Voice phone: 202-691-5606; 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

2005       I     134.6      157.4     117.0     161.7       120.5      120.1       127.9      123.0
          II     134.8      159.0     118.0     161.8       119.4      120.0       129.9      123.7
         III     136.2      160.9     118.2     164.7       119.9      120.9       131.2      124.7
          IV     136.1      161.7     118.8     165.7       119.7      121.8       132.4      125.7

      ANNUAL     135.4      159.8     118.0     163.5       119.9      120.7       130.4      124.3

2006       I     137.4      164.3     119.6     170.8       122.8      124.4       130.2      126.6
          II     137.7      165.4     120.1     170.2       120.8      123.6       134.2      127.5
         III     137.6      166.2     120.8     170.5       120.2      123.9       134.6      127.9
          IV     138.1      167.4     121.2    r174.8      r123.8     r126.6      r130.9      128.2

      ANNUAL     137.7      165.8     120.4    r171.6      r121.9     r124.6      r132.5      127.5

2007       I    r138.3     r167.6    r121.1    r175.9      r123.4     r127.2      r133.1     r129.4
---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

2005       I       3.4        4.2       0.8       4.2         2.2        0.8         6.6        3.0
          II       0.5        4.1       3.6       0.2        -3.6       -0.3         6.5        2.3
         III       4.3        4.9       0.6       7.3         1.7        2.9         4.1        3.3
          IV      -0.2        1.8       2.1       2.7        -0.8        2.9         3.5        3.2

      ANNUAL       2.1        3.7       1.6       4.2         0.8        2.0         4.2        2.9

2006       I       3.8        6.7       2.8      12.9        10.7        8.8        -6.3        2.7
          II       1.0        2.7       1.7      -1.6        -6.2       -2.6        12.6        3.1
         III      -0.3        1.9       2.2       0.9        -2.2        1.2         1.2        1.2
          IV       1.5        2.9       1.4     r10.4       r12.8       r8.8      r-10.4        1.0

      ANNUAL       1.7        3.8       2.1      r5.0        r1.6       r3.2        r1.6        2.6

2007       I      r0.5       r0.4     r-0.1      r2.5       r-1.4       r1.9        r6.8        3.7
---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

2005       I       2.5        3.8       1.3       4.7         1.7        2.2         4.0        2.9
          II       1.5        3.6       2.0       3.9         0.9        2.3         3.0        2.6
         III       2.4        3.9       1.5       4.5         0.8        2.1         4.5        3.0
          IV       2.0        3.7       1.7       3.6        -0.1        1.6         5.2        3.0

      ANNUAL       2.1        3.7       1.6       4.2         0.8        2.0         4.2        2.9

2006       I       2.1        4.4       2.3       5.7         1.9        3.5         1.8        2.9
          II       2.2        4.0       1.8       5.2         1.2        2.9         3.3        3.1
         III       1.1        3.3       2.2       3.6         0.2        2.5         2.5        2.5
          IV       1.5        3.5       2.0      r5.5        r3.4       r3.9       r-1.1        2.0

      ANNUAL       1.7        3.8       2.1      r5.0        r1.6       r3.2        r1.6        2.6

2007       I      r0.7       r2.0       1.3      r3.0        r0.5       r2.2        r2.2        2.2
---------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                       June 6, 2007
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

2005       I     133.6      157.6     118.0     160.5       119.6      120.1       129.4      123.5
          II     134.1      159.4     118.8     160.8       118.7      119.9       131.8      124.3
         III     135.4      161.3     119.1     163.5       119.1      120.8       133.2      125.3
          IV     135.2      162.0     119.8     164.5       118.8      121.7       134.4      126.4

      ANNUAL     134.6      160.0     118.9     162.3       119.1      120.6       132.2      124.9

2006       I     136.3      164.6     120.7     169.6       121.9      124.4       132.2      127.3
          II     136.7      165.7     121.2     169.0       120.0      123.6       136.5      128.3
         III     136.6      166.5     121.9     169.2       119.2      123.9       136.7      128.6
          IV     137.3      167.7     122.1    r173.8      r123.1     r126.6      r132.5      128.8

      ANNUAL     136.7      166.1     121.5    r170.4      r121.0     r124.6      r134.5      128.2

2007       I    r137.6     r167.9    r122.0    r175.0      r122.8     r127.1      r134.4     r129.8
---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

2005       I       4.0        4.2       0.3       4.7         2.7        0.7         7.7        3.3
          II       1.5        4.4       2.9       0.9        -2.9       -0.6         7.7        2.5
         III       3.7        4.9       1.1       6.8         1.2        3.0         4.2        3.5
          IV      -0.6        1.8       2.3       2.4        -1.0        3.0         3.7        3.3

      ANNUAL       2.1        3.8       1.6       4.1         0.8        2.0         4.9        3.1

2006       I       3.5        6.7       3.0      12.9        10.7        9.1        -6.3        2.9
          II       1.2        2.7       1.5      -1.4        -6.1       -2.5        13.5        3.4
         III      -0.5        1.9       2.4       0.6        -2.5        1.1         0.5        0.8
          IV       2.1        2.9       0.8     r11.2       r13.6       r8.9      r-11.6        0.5

      ANNUAL       1.6        3.8       2.1      r5.0        r1.6       r3.3        r1.7        2.7

2007       I      r1.0       r0.6     r-0.4      r2.8       r-1.0       r1.8        r5.6        3.2
---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

2005       I       2.4        3.8       1.4       4.6         1.5        2.2         4.7        3.1
          II       1.5        3.6       2.0       3.9         0.9        2.3         4.0        3.0
         III       2.4        4.0       1.6       4.5         0.7        2.0         5.2        3.3
          IV       2.1        3.8       1.6       3.7         0.0        1.5         5.8        3.2

      ANNUAL       2.1        3.8       1.6       4.1         0.8        2.0         4.9        3.1

2006       I       2.0        4.4       2.3       5.7         1.9        3.6         2.2        3.0
          II       1.9        4.0       2.0       5.1         1.0        3.1         3.6        3.3
         III       0.9        3.2       2.3       3.5         0.1        2.6         2.6        2.6
          IV       1.6        3.5       1.9      r5.6        r3.6       r4.0       r-1.4        1.9

      ANNUAL       1.6        3.8       2.1      r5.0        r1.6       r3.3        r1.7        2.7

2007       I      r1.0       r2.0       1.1      r3.2        r0.7       r2.2        r1.6        2.0
---------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                       June 6, 2007
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

2005       I            168.7        142.2         84.3        166.2          123.9          98.5
          II            171.2        143.4         83.8        167.8          123.9          98.0
         III            172.6        144.2         83.5        170.7          124.4          98.9
          IV            173.9        147.0         84.5        170.9          123.4          98.2

      ANNUAL            171.6        144.2         84.0        168.9          123.9          98.4

2006       I            175.7        149.1         84.9        176.4          126.8         100.4
          II            177.3        151.2         85.3        173.9          123.5          98.1
         III            179.9        153.0         85.1        173.9          122.5          96.7
          IV            180.7        152.2         84.2       r178.8         r126.6         r98.9

      ANNUAL            178.4        151.4         84.9       r175.7         r124.8         r98.5

2007       I           r181.8       r152.7        r84.0       r181.8         r127.6        r100.0
--------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

2005       I              6.0          4.9         -1.1          2.0            0.0          -3.8
          II              5.9          3.3         -2.4          3.9            0.0          -1.9
         III              3.4          2.2         -1.2          7.2            1.6           3.7
          IV              3.1          7.9          4.7          0.4           -3.0          -2.6

      ANNUAL              4.8          3.6         -1.1          4.7            1.3          -0.1

2006       I              4.1          6.0          1.9         13.5           11.3           9.0
          II              3.8          5.7          1.9         -5.4           -9.9          -8.8
         III              5.9          4.8         -1.1         -0.2           -3.3          -5.8
          IV              1.9         -2.1         -3.9        r11.8          r14.2          r9.8

      ANNUAL              4.0          5.0          1.0         r4.1           r0.7          r0.1

2007       I             r2.4         r1.2         -1.1         r6.9           r3.0          r4.5
--------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

2005       I              4.4          3.0         -1.3          5.5            2.5           1.1
          II              5.0          3.4         -1.5          5.0            2.0           0.0
         III              5.2          3.5         -1.6          4.8            1.0          -0.4
          IV              4.6          4.6          0.0          3.4           -0.4          -1.2

      ANNUAL              4.8          3.6         -1.1          4.7            1.3          -0.1

2006       I              4.1          4.9          0.7          6.1            2.3           2.0
          II              3.6          5.5          1.8          3.7           -0.3           0.1
         III              4.2          6.1          1.8          1.8           -1.5          -2.3
          IV              3.9          3.6         -0.3         r4.6           r2.6          r0.7

      ANNUAL              4.0          5.0          1.0         r4.1           r0.7          r0.1

2007       I             r3.5          2.4         -1.1         r3.1           r0.6         r-0.4
--------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                June 6, 2007
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

2005       I            190.7        169.5         88.9        161.7          120.5          84.8
          II            193.6        171.5         88.6        162.8          120.2          84.1
         III            196.8        174.4         88.6        165.9          120.9          84.3
          IV            200.9        180.4         89.8        165.7          119.7          82.5

      ANNUAL            195.5        174.0         89.0        164.0          120.3          83.9

2006       I            203.0        182.9         90.1        171.9          123.5          84.7
          II            205.9        187.0         90.9        169.7          120.5          82.4
         III            209.9        189.6         90.3        169.7          119.6          80.8
          IV            211.5        188.9         89.3       r175.5         r124.3         r83.0

      ANNUAL            207.5        187.1         90.1       r171.7         r121.9         r82.7

2007       I           r212.6       r188.7        r88.7       r179.1         r125.7         r84.3
--------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

2005       I              6.0          5.8         -0.2          0.3           -1.6          -5.4
          II              6.2          4.8         -1.4          2.7           -1.2          -3.3
         III              6.8          6.9          0.1          7.9            2.2           1.0
          IV              8.7         14.6          5.4         -0.6           -3.9          -8.5

      ANNUAL              5.1          4.9         -0.2          3.9            0.6          -1.1

2006       I              4.1          5.5          1.4         15.9           13.6          11.3
          II              5.9          9.4          3.3         -5.1           -9.6         -10.4
         III              8.1          5.5         -2.4          0.1           -2.9          -7.4
          IV              3.0         -1.4         -4.3        r14.4          r16.8         r11.1

      ANNUAL              6.2          7.5          1.3         r4.7           r1.3         r-1.4

2007       I             r2.2        r-0.4        r-2.5         r8.5           r4.5          r6.2
--------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

2005       I              3.2          2.7         -0.4          5.3            2.3           2.1
          II              4.4          4.0         -0.4          4.1            1.1          -0.3
         III              5.9          5.1         -0.7          3.8            0.0          -2.0
          IV              6.9          8.0          0.9          2.5           -1.1          -4.1

      ANNUAL              5.1          4.9         -0.2          3.9            0.6          -1.1

2006       I              6.4          7.9          1.4          6.3            2.5          -0.1
          II              6.4          9.1          2.5          4.2            0.2          -2.0
         III              6.7          8.7          1.9          2.3           -1.1          -4.1
          IV              5.2          4.7         -0.5         r5.9           r3.9          r0.7

      ANNUAL              6.2          7.5          1.3         r4.7           r1.3         r-1.4

2007       I             r4.8         r3.2        r-1.5         r4.2           r1.7         r-0.5
--------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                June 6, 2007
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

2005       I            147.1        113.9         77.4        172.5          128.6         117.2
          II            149.3        114.3         76.6        175.0          129.2         117.2
         III            149.5        113.5         75.9        177.5          129.3         118.7
          IV            148.6        113.8         76.6        178.4          128.9         120.1

      ANNUAL            148.6        113.9         76.6        175.9          129.0         118.3

2006       I            150.0        115.6         77.1        182.4          131.1         121.6
          II            150.8        116.1         77.0        179.4          127.4         119.0
         III            151.8        117.3         77.2        179.2          126.2         118.0
          IV            151.9        116.4         76.6       r182.3         r129.1        r120.0

      ANNUAL            151.1        116.3         77.0       r180.8         r128.4        r119.6

2007       I           r152.6       r117.3        r76.9       r184.2         r129.2        r120.7
--------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

2005       I              6.4          3.8         -2.5          5.1            3.0          -1.2
          II              6.1          1.6         -4.2          6.1            2.1          -0.1
         III              0.6         -2.8         -3.4          5.8            0.2           5.1
          IV             -2.5          0.9          3.5          2.1           -1.3           4.7

      ANNUAL              5.0          2.1         -2.7          5.9            2.5           0.9

2006       I              3.8          6.6          2.7          9.2            7.1           5.2
          II              2.2          1.7         -0.6         -6.3          -10.8          -8.4
         III              2.7          4.1          1.4         -0.5           -3.6          -3.1
          IV              0.3         -2.9         -3.2         r7.1           r9.4          r6.8

      ANNUAL              1.7          2.2          0.5         r2.8          r-0.5          r1.1

2007       I             r1.8         r3.1         r1.3         r4.3           r0.4          r2.4
--------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

2005       I              6.3          3.4         -2.7          5.8            2.7          -0.4
          II              6.2          2.8         -3.2          6.6            3.6           0.4
         III              4.9          1.5         -3.2          6.4            2.6           1.4
          IV              2.6          0.9         -1.7          4.7            1.0           2.1

      ANNUAL              5.0          2.1         -2.7          5.9            2.5           0.9

2006       I              1.9          1.5         -0.4          5.7            1.9           3.7
          II              1.0          1.5          0.5          2.5           -1.4           1.5
         III              1.5          3.3          1.8          0.9           -2.4          -0.6
          IV              2.2          2.3          0.1         r2.2           r0.2         r-0.1

      ANNUAL              1.7          2.2          0.5         r2.8          r-0.5          r1.1

2007       I              1.8          1.4        r-0.3         r1.0          r-1.4         r-0.7
--------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                June 6, 2007
r=revised                                                       Source: Bureau of Labor Statistics





Table 6. Nonfinancial corporate sector: 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

2005       I    141.2    165.6     117.3    158.7     118.3     112.4    111.5    112.2    150.2    115.6
          II    142.1    168.0     118.2    159.1     117.4     111.9    111.9    111.9    161.4    116.4
         III    142.2    168.9     118.8    161.8     117.9     113.8    114.9    114.1    152.9    117.6
          IV    142.3    170.4     119.7    162.8     117.6     114.4    113.3    114.1    163.7    118.5

      ANNUAL    142.0    168.2     118.5    160.6     117.8     113.1    112.9    113.1    157.1    117.0

2006       I    145.9    175.6     120.4    167.4     120.3     114.7    111.1    113.8    177.3    119.4
          II    144.3    174.4     120.9    167.1     118.6     115.8    113.7    115.2    172.1    120.3
         III    145.7    177.0     121.5    167.5     118.0     114.9    112.1    114.2    184.4    120.4
          IV   r146.2   r178.1     121.8   r171.0    r121.1    r117.0   r112.5   r115.8   r171.1    120.7

      ANNUAL   r145.5   r176.3     121.1   r168.3    r119.5    r115.6   r112.3   r114.7   r176.2   r120.2

2007       I    146.4    178.4     121.9    173.0     121.4     118.2    112.7    116.7    173.9    121.8
----------------------------------------------------------------------------------------------------------
                             Percent change from previous quarter at annual rate(5)

2005       I      4.0      4.1       0.1      4.4       2.4       0.4      5.0      1.6     19.7      3.5
          II      2.6      5.7       3.1      0.9      -2.9      -1.6      1.5     -0.8     33.6      2.8
         III      0.1      2.2       2.0      7.1       1.5       7.0     11.1      8.1    -19.6      4.3
          IV      0.5      3.6       3.1      2.5      -0.9       2.0     -5.4      0.0     31.2      3.3

      ANNUAL      2.3      4.0       1.6      4.1       0.8       1.8      3.0      2.1     12.6      3.3

2006       I     10.4     13.0       2.3     11.8       9.6       1.2     -7.7     -1.2     37.9      3.1
          II     -4.4     -2.7       1.7     -0.8      -5.5       3.7      9.6      5.3    -11.4      2.9
         III      4.1      6.1       1.9      1.1      -2.1      -2.9     -5.4     -3.6     31.8      0.5
          IV     r1.3     r2.4       1.1     r8.7     r11.0      r7.3     r1.6     r5.8   r-25.8      0.9

      ANNUAL      2.5      4.8       2.2     r4.8       1.4       2.2     -0.5      1.5     12.2      2.7

2007       I      0.6      0.7       0.1      4.7       0.8       4.1      0.7      3.2      6.8      3.7
----------------------------------------------------------------------------------------------------------
                          Percent change from corresponding quarter of previous year

2005       I      2.8      3.9       1.1      4.5       1.5       1.7      2.2      1.9     14.4      3.2
          II      2.8      4.6       1.7      3.8       0.9       1.0      2.1      1.3     15.6      2.9
         III      1.8      3.5       1.7      4.5       0.7       2.7      4.7      3.2      6.8      3.6
          IV      1.8      3.9       2.1      3.7       0.0       1.9      2.9      2.1     14.0      3.5

      ANNUAL      2.3      4.0       1.6      4.1       0.8       1.8      3.0      2.1     12.6      3.3

2006       I      3.3      6.0       2.6      5.5       1.7       2.1     -0.4      1.4     18.1      3.4
          II      1.5      3.8       2.3      5.0       1.0       3.5      1.5      2.9      6.6      3.4
         III      2.5      4.8       2.2      3.5       0.1       1.0     -2.5      0.0     20.6      2.4
          IV     r2.7     r4.5       1.8     r5.0      r3.0      r2.3    r-0.7      1.5     r4.5      1.8

      ANNUAL      2.5      4.8       2.2     r4.8       1.4       2.2     -0.5      1.5     12.2      2.7

2007       I      0.3      1.6       1.2      3.4       0.9       3.0      1.5      2.6     -1.9      2.0
----------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                        June 6, 2007
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 
-1.4 and +1.3 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 fourth quarter of 2006.


			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 1978-2006 is based on the 
Consumer Price Index research series (CPI-U-RS).

(3)  Unit nonlabor payments include profits, consumption of fixed capital, 
taxes on production and imports less subsidies, net interest and 
miscellaneous payments, business current transfer payments, rental 
income of persons, and the current surplus of government enterprises.

(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 consumption of fixed capital, taxes on 
production and imports less subsidies, net interest and miscellaneous 
payments, and business current transfer payments.

(7)  Total unit costs are the sum of unit labor and nonlabor costs.

(8)  Unit profits include corporate profits before tax with inventory 
valuation and capital consumption adjustments.