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                        PRODUCTIVITY AND COSTS
                    Third Quarter 2007, preliminary


   The Bureau of Labor Statistics of the U.S. Department of Labor today 
reported preliminary productivity data--as measured by output per hour of 
all persons--for the third quarter of 2007.  The preliminary seasonally-
adjusted annual rates of productivity growth in the third quarter were:

                    5.3 percent in the business sector and
                    4.9 percent in the nonfarm business sector.
                  
In both sectors, the productivity gains were the largest since the third 
quarter of 2003, and reflected 4.3 percent per year growth in output combined 
with small declines in hours worked (See table A).

   In manufacturing, productivity increases in the third quarter were:

                    4.6 percent in manufacturing,
                    5.7 percent in durable goods manufacturing, and
                    4.1 percent in nondurable goods manufacturing.

Manufacturing productivity grew faster in the third quarter than it had one 
quarter earlier.  In the second quarter of 2007, a 2.4 percent gain in 
overall manufacturing productivity reflected a 5.2 percent increase in 
durable goods output per hour and a 0.8 percent decline in nondurable goods 
productivity, as revised.  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.  Third-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 independently prepared by the Board 
of Governors of the Federal Reserve System.  See Technical Notes for further 
information on data sources. 


------------------------------------------------------------------------------
Table A. Productivity and costs: Preliminary third-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                 5.3        4.3    -0.9       5.1        3.1     -0.2
Nonfarm business         4.9        4.3    -0.5       4.7        2.7     -0.2
Manufacturing            4.6        4.3    -0.4       2.3        0.4     -2.2
  Durable                5.7        6.6     0.8       1.2       -0.7     -4.3
  Nondurable             4.1        1.6    -2.4       4.3        2.4      0.2

                           Percent change from same quarter a year ago

Business                 2.5        2.8     0.3       6.9        4.4      4.3
Nonfarm business         2.4        2.9     0.5       6.7        4.3      4.3
Manufacturing            2.7        1.9    -0.8       7.2        4.7      4.4
  Durable                3.8        2.9    -0.8       6.9        4.4      3.0
  Nondurable             1.3        0.6    -0.7       7.7        5.2      6.2
------------------------------------------------------------------------------


Business

   From the second quarter to the third quarter of 2007, labor productivity 
in the business sector increased 5.3 percent, the largest gain since the 
third quarter of 2003, when it increased 9.1 percent (seasonally adjusted 
annual rates).  Output per hour had increased 3.6 percent in the second 
quarter, as revised.  Output grew at about the same rate in the second and 
third quarters of 2007--4.4 percent and 4.3 percent, respectively--but 
productivity grew faster in the third quarter because hours fell 0.9 percent, 
compared to a 0.8 percent increase one quarter earlier (tables B and 1).  The 
third-quarter hours decline was the first in the business sector since the 
second quarter of 2003, when hours fell 2.2 percent.  From the third quarter 
of 2006 to the third quarter of 2007, productivity increased 2.5 percent, 
matching the trend rate of productivity growth for the 1947-2006 period 
covered by the measure.

   Hourly compensation in the business sector increased at an annual rate 
of 5.1 percent during the third quarter of 2007, slower than the 5.8-percent 
rise in the second quarter (as revised). This measure includes wages and 
salaries, supplements, employer contributions to employee benefit plans, and 
taxes.  Real hourly compensation, which takes into account changes in 
consumer prices, rose by 3.1 percent in the third quarter of 2007.

   Changes in unit labor costs are approximately equal to changes in hourly 
compensation less changes in productivity.  In the third quarter of 2007, 
unit labor costs declined 0.2 percent as hourly compensation increased 5.1 
percent and productivity increased more, 5.3 percent.  Unit labor costs had 
increased 2.2 percent in the second quarter, and 5.3 percent in the first 
quarter, of 2007.  The implicit price deflator for business sector output was 
unchanged in the third quarter of 2007 following a 2.2 percent increase in 
the second quarter. 


Nonfarm business

   Productivity grew 4.9 percent in the third quarter of 2007 as output 
grew 4.3 percent and hours worked declined 0.5 percent.  After revision, 
output per hour increased 2.2 percent in the second quarter, as output growth 
of 4.2 percent was partially offset by a 2.0 percent increase in hours 
worked (table 2).  The third-quarter productivity increase was the largest 
since a 10.4 percent increase in the third quarter of 2003.  Nonfarm business 
productivity increased 2.4 percent over the last four quarters, more than the 
1.0 percent increase in calendar year 2006, and approaching the 2.7 percent 
average from 2000 to 2005.

   Nonfarm hourly compensation increased at a 4.7 percent annual rate in 
the third quarter of 2007. When the rise in consumer prices is taken into 
account, real hourly compensation rose 2.7 percent during the third quarter, 
after falling 1.5 percent in the second quarter.

   Unit labor costs in the nonfarm business sector edged down 0.2 percent 
during the third quarter of 2007, after rising 2.2 percent in the second 
quarter.  The implicit price deflator for nonfarm business output also 
declined in the third quarter of 2007, by 0.4 percent.


Manufacturing

   Productivity increased 4.6 percent in manufacturing in the third quarter 
of 2007; output grew 4.3 percent and hours of all persons fell 0.4 percent 
(seasonally adjusted annual rates).  In durable goods industries, 
productivity increased 5.7 percent on the strength of 6.6 percent output 
growth that was partially offset by a 0.8 percent rise in hours worked.  
Productivity increased 4.1 percent in nondurable goods in the third quarter, 
but in this sector a 2.4 percent decrease in hours contributed more to the 
productivity gain than a 1.6 percent increase in output (tables 3, 4, and 5).  
The 2.7 percent increase in total manufacturing productivity from the third 
quarter of 2006 to the third quarter of 2007 is smaller than the 4.2 percent 
average annual rate of productivity growth from 2000 to 2006.

   The hourly compensation of manufacturing workers increased 2.3 percent 
during the third quarter of 2007, with a 1.2 percent gain in the durable 
goods subsector and a 4.3 percent gain in nondurable goods industries.  
Hourly compensation in total manufacturing had increased 3.7 percent in the 
second quarter.  When the increase in consumer prices is taken into account, 
real hourly compensation increased 0.4 percent in the third quarter.

   Unit labor costs in manufacturing fell 2.2 percent in the third quarter 
of 2007, reflecting a decline of 4.3 percent in durable goods industries and 
a 0.2 percent increase in nondurable goods industries.  In the overall 
manufacturing sector, these costs had increased 1.3 percent in the previous 
quarter.  Unit labor costs have increased 4.4 percent since the third quarter 
of 2006--the largest four-quarter increase since the period ending in the 
fourth quarter of 2000, when they increased 5.2 percent.


Revised Measures

   Revised and previous measures for the second quarter of 2007 for the 
business, nonfarm business, and manufacturing sectors are compared in table 
B.  In the business sector, similar downward revisions to output and hours 
resulted in a revised productivity increase of 3.6 percent, about the same as 
reported Sept. 6.  In the nonfarm business sector, output was revised down by 
more than hours, and productivity growth was revised down to 2.2 percent.  In 
the manufacturing sector, productivity was revised up due to an upward 
revision to output and a small downward revision to hours.


------------------------------------------------------------------------------
Table B. Previous and revised productivity and related measures
Quarterly percent change at seasonally adjusted annual rate
------------------------------------------------------------------------------
                                                               Real
                                                     Hourly    hourly    Unit
                        Produc-                      compen-   compen-   labor
Sector                  tivity    Output   Hours     sation    sation    costs
-------------------------------------------------------------------------------

                                 Second quarter 2007

Business:
  Previous               3.5        4.6      1.0       5.5     -0.5       1.9
  Revised                3.6        4.4      0.8       5.8     -0.2       2.2
Nonfarm business:
  Previous               2.6        5.0      2.3       4.1     -1.8       1.4
  Revised                2.2        4.2      2.0       4.4     -1.5       2.2
Manufacturing:
  Previous               1.8        4.0      2.1       3.4     -2.4       1.6
  Revised                2.4        4.4      2.0       3.7     -2.2       1.3
-------------------------------------------------------------------------------

   In all three sectors, hourly compensation was revised up by 0.3 
percentage point.  In the business and nonfarm business sectors, unit labor 
costs rose more than previously reported.  Because manufacturing output per 
hour was revised up by more than compensation per hour, unit labor costs were 
revised downwards.

   Hours worked during the second quarter in all sectors now reflect more 
current data on the ratios of hours worked to hours paid in private nonfarm 
businesses.


Revised measures: Nonfinancial Corporations 

   Productivity and cost measures for nonfinancial corporations for the 
second quarter of 2007 also were revised to incorporate more recent 
information than was available on Sept. 6.


------------------------------------------------------------------------------
Table C.  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
------------------------------------------------------------------------------

                              Second quarter 2007

Previous   3.5      4.6    1.0      4.7    -1.2      1.1      8.6       1.5

Revised    3.8      4.6    0.8      4.9    -1.0      1.1      8.6       1.4
------------------------------------------------------------------------------

   Productivity rose 3.8 percent in the second quarter of 2007, compared 
with the preliminary estimate of a 3.5 percent increase.  This was the result 
of a downward revision in hours growth, from 1.0 percent to 0.8 percent; 
output growth was unchanged.  Unit labor costs were not revised, as an upward 
revision to hourly compensation was offset by the upward revision to 
productivity (tables C and 6).


                              Next release date


   The next release of Productivity and Costs is scheduled for 8:30 AM EST, 
Wednesday, Dec. 5, 2007.  It will present third-quarter measures for 
nonfinancial corporations and revised third-quarter measures for business, 
nonfarm business, and manufacturing.



				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     134.4      157.2     117.0     161.4       120.3      120.1       128.2      123.1
          II     134.3      158.5     118.0     161.7       119.4      120.4       129.8      123.9
         III     135.9      160.6     118.2     164.2       119.6      120.8       132.0      125.0
          IV     135.5      161.0     118.8     165.4       119.4      122.0       133.0      126.1

      ANNUAL     135.0      159.3     118.0     163.2       119.7      120.9       130.8      124.5

2006       I     136.4      163.2     119.6     168.2       120.9      123.4       133.0      127.0
          II     136.6      164.2     120.2     168.1       119.3      123.0       136.5      128.0
         III     136.1      164.4     120.8     168.7       118.9      124.0       136.6      128.7
          IV     136.5      165.5     121.2     173.4       122.8      127.0       132.2      128.9

      ANNUAL     136.4      164.3     120.5     169.6       120.4      124.3       134.6      128.2

2007       I     136.6      165.6     121.2     175.7       123.3      128.6       132.9      130.2
          II    r137.8     r167.3    r121.5    r178.2      r123.2     r129.3      r133.6     r130.9
         III     139.6      169.1     121.2     180.4       124.2      129.3       133.7      130.9
---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

2005       I       3.0        3.7       0.7       3.0         1.1        0.0         9.1        3.4
          II      -0.3        3.3       3.6       0.7        -3.1        1.0         5.1        2.6
         III       4.9        5.5       0.6       6.2         0.7        1.3         7.1        3.5
          IV      -1.1        1.0       2.1       2.9        -0.5        4.0         3.1        3.7

      ANNUAL       2.0        3.6       1.6       4.0         0.6        2.0         4.9        3.1

2006       I       2.5        5.5       2.9       7.2         5.1        4.6         0.0        2.8
          II       0.8        2.5       1.7      -0.4        -5.1       -1.2        10.7        3.3
         III      -1.5        0.6       2.2       1.6        -1.6        3.1         0.5        2.1
          IV       1.2        2.6       1.4      11.4        13.8       10.1       -12.4        0.8

      ANNUAL       1.0        3.1       2.1       3.9         0.6        2.9         2.9        2.9

2007       I       0.2        0.2       0.0       5.5         1.6        5.3         2.1        4.1
          II      r3.6       r4.4      r0.8      r5.8       r-0.2       r2.2        r2.2       r2.2
         III       5.3        4.3      -0.9       5.1         3.1       -0.2         0.2        0.0
---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

2005       I       2.5        3.8       1.2       5.0         1.9        2.4         4.1        3.1
          II       1.5        3.5       2.0       3.8         0.9        2.3         3.6        2.8
         III       2.4        3.9       1.5       4.0         0.3        1.6         5.8        3.2
          IV       1.6        3.4       1.7       3.2        -0.5        1.6         6.1        3.3

      ANNUAL       2.0        3.6       1.6       4.0         0.6        2.0         4.9        3.1

2006       I       1.5        3.8       2.3       4.2         0.5        2.7         3.8        3.1
          II       1.7        3.6       1.8       3.9         0.0        2.2         5.1        3.3
         III       0.2        2.4       2.2       2.8        -0.6        2.6         3.5        3.0
          IV       0.7        2.8       2.1       4.8         2.8        4.1        -0.6        2.2

      ANNUAL       1.0        3.1       2.1       3.9         0.6        2.9         2.9        2.9

2007       I       0.2        1.5       1.3       4.4         1.9        4.3        -0.1        2.6
          II       0.8       r1.9       1.1      r6.0         3.2        5.1       r-2.1       r2.3
         III       2.5        2.8       0.3       6.9         4.4        4.3        -2.2        1.7
---------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                       November 7, 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     133.4      157.4     118.0     160.3       119.5      120.2       129.6      123.6
          II     133.5      158.6     118.8     160.9       118.8      120.5       131.3      124.5
         III     135.0      160.8     119.1     163.2       118.8      120.9       133.7      125.6
          IV     134.5      161.2     119.8     164.2       118.6      122.1       134.8      126.8

      ANNUAL     134.1      159.5     118.9     162.1       118.9      120.9       132.4      125.1

2006       I     135.3      163.4     120.8     167.1       120.1      123.5       135.0      127.7
          II     135.6      164.4     121.2     167.0       118.6      123.2       138.7      128.9
         III     135.0      164.7     122.0     167.5       118.0      124.0       138.6      129.4
          IV     135.6      165.7     122.2     172.4       122.1      127.1       133.6      129.5

      ANNUAL     135.4      164.5     121.5     168.5       119.7      124.5       136.5      128.9

2007       I     135.9      165.9     122.1     174.9       122.7      128.7       133.9      130.6
          II    r136.6     r167.6    r122.7    r176.8      r122.2     r129.4      r134.5     r131.3
         III     138.2      169.4     122.5     178.8       123.1      129.4       134.3      131.2
---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

2005       I       3.7        3.9       0.2       3.6         1.6       -0.1        10.4        3.8
          II       0.3        3.2       2.9       1.5        -2.4        1.2         5.1        2.7
         III       4.4        5.6       1.1       5.7         0.2        1.3         7.8        3.8
          IV      -1.4        0.9       2.4       2.6        -0.8        4.1         3.2        3.7

      ANNUAL       1.9        3.6       1.6       4.0         0.7        2.0         5.5        3.4

2006       I       2.5        5.7       3.1       7.2         5.1        4.6         0.5        3.0
          II       0.8        2.4       1.6      -0.2        -5.0       -1.0        11.5        3.7
         III      -1.6        0.8       2.4       1.3        -1.8        2.9        -0.4        1.6
          IV       1.8        2.6       0.8      12.2        14.6       10.3       -13.6        0.3

      ANNUAL       1.0        3.2       2.2       3.9         0.6        2.9         3.1        3.0

2007       I       0.7        0.3      -0.3       5.9         2.0        5.2         1.0        3.6
          II      r2.2       r4.2      r2.0      r4.4       r-1.5       r2.2        r1.8       r2.1
         III       4.9        4.3      -0.5       4.7         2.7       -0.2        -0.7       -0.4
---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

2005       I       2.5        3.8       1.4       4.9         1.8        2.3         4.8        3.3
          II       1.4        3.4       2.0       3.9         0.9        2.5         4.3        3.2
         III       2.2        3.8       1.5       4.0         0.3        1.7         6.4        3.5
          IV       1.7        3.4       1.7       3.3        -0.4        1.6         6.6        3.5

      ANNUAL       1.9        3.6       1.6       4.0         0.7        2.0         5.5        3.4

2006       I       1.4        3.8       2.4       4.2         0.5        2.8         4.1        3.3
          II       1.5        3.6       2.0       3.8        -0.2        2.2         5.7        3.5
         III       0.1        2.4       2.4       2.7        -0.7        2.6         3.6        3.0
          IV       0.9        2.8       2.0       5.0         3.0        4.1        -0.9        2.2

      ANNUAL       1.0        3.2       2.2       3.9         0.6        2.9         3.1        3.0

2007       I       0.4        1.5       1.1       4.7         2.2        4.3        -0.8        2.3
          II      r0.7       r2.0      r1.2      r5.9        r3.1       r5.1       r-3.0       r1.9
         III       2.4        2.9       0.5       6.7         4.3        4.3        -3.1        1.4
---------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                       November 7, 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            168.3        142.7         84.8        166.2          123.9          98.7
          II            170.9        143.8         84.1        167.8          123.9          98.2
         III            172.4        144.5         83.8        170.2          124.0          98.7
          IV            173.7        147.3         84.8        168.8          121.9          97.2

      ANNUAL            171.3        144.6         84.4        168.3          123.4          98.2

2006       I            175.4        149.5         85.2        172.6          124.1          98.4
          II            177.0        151.6         85.6        170.1          120.8          96.1
         III            179.8        153.4         85.3        170.7          120.2          94.9
          IV            180.7        152.6         84.4        176.4          125.0          97.6

      ANNUAL            178.2        151.7         85.1        172.4          122.5          96.8

2007       I            181.5        152.9         84.3        180.2          126.4          99.3
          II           r182.6       r154.6        r84.7       r181.9         r125.7         r99.6
         III            184.6        156.2         84.6        182.9          125.9          99.1
--------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

2005       I              4.9          4.6         -0.3          1.0           -0.9          -3.7
          II              6.3          3.1         -3.0          4.0            0.0          -2.2
         III              3.5          2.1         -1.4          5.6            0.1           2.1
          IV              3.1          7.9          4.6         -3.1           -6.4          -6.0

      ANNUAL              4.8          3.5         -1.2          4.2            0.8          -0.6

2006       I              4.0          6.0          1.9          9.4            7.2           5.1
          II              3.7          5.7          2.0         -5.8          -10.2          -9.1
         III              6.5          4.8         -1.6          1.4           -1.8          -4.8
          IV              2.0         -2.1         -4.0         14.2           16.6          12.0

      ANNUAL              4.0          4.9          0.9          2.5           -0.8          -1.5

2007       I              1.7          0.9         -0.8          8.9            4.8           7.0
          II             r2.4         r4.4         r2.0         r3.7          r-2.2          r1.3
         III              4.6          4.3         -0.4          2.3            0.4          -2.2
--------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

2005       I              4.4          3.1         -1.2          6.0            2.9           1.5
          II              5.1          3.4         -1.6          5.0            2.1           0.0
         III              5.2          3.3         -1.9          4.0            0.3          -1.1
          IV              4.4          4.4          0.0          1.8           -1.8          -2.5

      ANNUAL              4.8          3.5         -1.2          4.2            0.8          -0.6

2006       I              4.2          4.7          0.5          3.9            0.1          -0.3
          II              3.6          5.4          1.8          1.3           -2.5          -2.1
         III              4.3          6.1          1.7          0.3           -3.0          -3.8
          IV              4.0          3.6         -0.5          4.5            2.5           0.5

      ANNUAL              4.0          4.9          0.9          2.5           -0.8          -1.5

2007       I              3.5          2.3         -1.1          4.4            1.9           0.9
          II             r3.1         r2.0         -1.1         r6.9           r4.1           3.7
         III              2.7          1.9         -0.8          7.2            4.7           4.4
--------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                November 7, 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            189.8        169.7         89.4        161.4          120.3          85.0
          II            193.4        171.6         88.8        162.5          120.0          84.0
         III            196.5        174.5         88.8        165.2          120.4          84.1
          IV            200.7        180.5         89.9        163.6          118.2          81.5

      ANNUAL            195.1        174.1         89.2        163.2          119.7          83.6

2006       I            202.7        182.9         90.3        168.4          121.0          83.1
          II            205.5        187.1         91.1        165.7          117.7          80.7
         III            210.1        189.6         90.3        166.4          117.3          79.2
          IV            211.5        188.9         89.3        173.0          122.5          81.8

      ANNUAL            207.4        187.2         90.2        168.4          119.6          81.2

2007       I            212.3        188.7         88.9        176.5          123.8          83.1
          II           r215.1       r192.1        r89.3       r177.4         r122.7         r82.5
         III            218.1        195.2         89.5        177.9          122.5          81.6
--------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

2005       I              4.1          5.5          1.3          0.4           -1.5          -3.6
          II              7.7          4.7         -2.8          2.7           -1.2          -4.7
         III              6.6          6.8          0.2          7.0            1.4           0.4
          IV              8.9         14.5          5.2         -3.8           -7.0         -11.7

      ANNUAL              5.3          5.0         -0.3          3.8            0.5          -1.4

2006       I              3.9          5.5          1.5         12.1            9.9           7.9
          II              5.7          9.4          3.5         -6.1          -10.5         -11.2
         III              9.3          5.5         -3.5          1.7           -1.5          -6.9
          IV              2.7         -1.4         -4.1         16.6           19.1          13.5

      ANNUAL              6.3          7.5          1.1          3.2           -0.1          -2.9

2007       I              1.6         -0.5         -2.0          8.5            4.5           6.9
          II             r5.2         r7.3          2.0         r2.0          r-3.8         r-3.0
         III              5.7          6.6          0.8          1.2           -0.7          -4.3
--------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

2005       I              3.3          3.0         -0.3          6.0            2.9           2.6
          II              4.8          4.0         -0.8          4.4            1.5          -0.4
         III              6.2          5.1         -1.0          3.5           -0.2          -2.5
          IV              6.8          7.8          0.9          1.5           -2.1          -5.0

      ANNUAL              5.3          5.0         -0.3          3.8            0.5          -1.4

2006       I              6.8          7.8          1.0          4.3            0.6          -2.3
          II              6.3          9.0          2.6          2.0           -1.9          -4.0
         III              6.9          8.7          1.6          0.7           -2.6          -5.8
          IV              5.4          4.7         -0.7          5.7            3.6           0.3

      ANNUAL              6.3          7.5          1.1          3.2           -0.1          -2.9

2007       I              4.8          3.2         -1.5          4.9            2.3           0.1
          II             r4.6         r2.6         -1.9          7.0           r4.2           2.3
         III              3.8          2.9         -0.8          6.9            4.4           3.0
--------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                November 7, 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            147.3        114.7         77.8        173.3          129.2         117.6
          II            149.1        115.1         77.2        176.1          130.0         118.1
         III            149.5        114.2         76.4        177.3          129.2         118.6
          IV            148.4        114.4         77.1        176.5          127.5         118.9

      ANNUAL            148.6        114.6         77.1        175.8          129.0         118.3

2006       I            149.8        116.3         77.6        178.3          128.2         119.0
          II            150.7        116.8         77.5        175.9          124.9         116.7
         III            151.6        117.9         77.8        176.4          124.3         116.4
          IV            152.0        117.1         77.0        180.5          127.9         118.8

      ANNUAL            151.0        117.0         77.5        177.8          126.3         117.7

2007       I            152.4        117.8         77.3        184.8          129.7         121.2
          II           r152.1       r118.2        r77.7       r187.9         r129.9        r123.6
         III            153.6        118.6         77.2        189.9          130.7         123.6
--------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

2005       I              6.4          3.3         -2.9          1.8           -0.2          -4.3
          II              4.9          1.3         -3.4          6.5            2.5           1.6
         III              1.0         -3.0         -4.0          2.8           -2.6           1.7
          IV             -2.9          0.8          3.8         -1.9           -5.2           1.0

      ANNUAL              4.8          1.9         -2.7          4.8            1.4           0.0

2006       I              3.9          6.6          2.7          4.3            2.3           0.4
          II              2.4          1.7         -0.7         -5.4           -9.9          -7.6
         III              2.4          4.1          1.7          1.2           -2.0          -1.2
          IV              1.0         -2.9         -3.9          9.7           12.0           8.6

      ANNUAL              1.6          2.1          0.5          1.1           -2.1          -0.5

2007       I              1.2          2.6          1.4          9.8            5.7           8.5
          II            r-0.8         r1.2         r2.1         r6.9           r0.9          r7.8
         III              4.1          1.6         -2.4          4.3            2.4           0.2
--------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

2005       I              6.3          3.3         -2.8          5.9            2.8          -0.4
          II              5.8          2.5         -3.1          6.1            3.0           0.2
         III              4.7          1.2         -3.3          4.9            1.1           0.1
          IV              2.3          0.6         -1.7          2.3           -1.4           0.0

      ANNUAL              4.8          1.9         -2.7          4.8            1.4           0.0

2006       I              1.7          1.4         -0.3          2.9           -0.8           1.2
          II              1.1          1.5          0.4         -0.1           -3.9          -1.2
         III              1.4          3.3          1.8         -0.5           -3.8          -1.9
          IV              2.4          2.3         -0.1          2.3            0.3          -0.1

      ANNUAL              1.6          2.1          0.5          1.1           -2.1          -0.5

2007       I              1.7          1.3         -0.4          3.6            1.2           1.9
          II             r0.9         r1.2         r0.3          6.8            4.0          r5.9
         III              1.3          0.6         -0.7          7.7            5.2           6.2
--------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                November 7, 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    140.3    164.6     117.3    158.0     117.8     112.6    111.5    112.3    151.9    115.9
          II    141.1    166.8     118.2    158.5     117.0     112.3    111.7    112.1    161.7    116.6
         III    140.5    166.9     118.8    160.8     117.1     114.4    115.1    114.6    147.5    117.6
          IV    141.4    169.2     119.7    161.8     116.9     114.5    112.8    114.0    159.5    118.1

      ANNUAL    140.8    166.9     118.5    159.8     117.2     113.5    112.8    113.3    155.2    117.0

2006       I    142.4    171.5     120.4    163.8     117.8     115.0    112.5    114.4    164.4    118.8
          II    141.8    171.5     120.9    163.9     116.4     115.6    114.3    115.2    164.8    119.7
         III    142.9    173.6     121.5    164.6     115.9     115.2    113.8    114.8    172.6    120.0
          IV    143.3    174.6     121.8    169.3     119.9     118.1    114.5    117.1    150.0    120.1

      ANNUAL    142.6    172.8     121.2    165.4     117.5     116.0    113.8    115.4    162.9    119.6

2007       I    143.6    175.0     121.9    171.2     120.1     119.2    114.6    118.0    154.3    121.2
          II   r144.9   r177.0    r122.1   r173.2    r119.8    r119.5   r114.3   r118.1   r157.5   r121.6
----------------------------------------------------------------------------------------------------------
                             Percent change from previous quarter at annual rate(5)

2005       I      0.3      0.3       0.1      2.7       0.7       2.4      6.8      3.6      9.8      4.3
          II      2.2      5.4       3.1      1.2      -2.6      -1.0      0.5     -0.6     28.4      2.5
         III     -1.6      0.4       2.0      6.1       0.5       7.8     12.7      9.1    -30.8      3.4
          IV      2.4      5.6       3.1      2.4      -1.0       0.0     -7.6     -2.1     36.9      1.8

      ANNUAL      1.1      2.7       1.6      3.8       0.5       2.7      3.0      2.8      7.0      3.3

2006       I      3.1      5.5       2.3      5.2       3.2       2.0     -1.0      1.2     12.7      2.6
          II     -1.8     -0.1       1.7      0.2      -4.6       2.0      6.4      3.1      1.2      2.9
         III      3.1      5.0       1.9      1.6      -1.5      -1.4     -1.5     -1.5     20.1      1.0
          IV      1.3      2.4       1.2     11.9      14.3      10.5      2.2      8.3    -42.9      0.3

      ANNUAL      1.3      3.5       2.2      3.5       0.2       2.2      0.9      1.9      5.0      2.2

2007       I      0.7      0.9       0.2      4.5       0.6       3.8      0.5      2.9     11.8      3.9
          II     r3.8      4.6      r0.8     r4.9     r-1.0       1.1    r-1.1     r0.5      8.6     r1.4
----------------------------------------------------------------------------------------------------------
                          Percent change from corresponding quarter of previous year

2005       I      2.2      3.3       1.1      4.8       1.7       2.5      1.8      2.3     12.4      3.4
          II      1.6      3.3       1.7      3.7       0.7       2.1      2.1      2.1     10.9      3.1
         III     -0.1      1.5       1.7      3.8       0.1       4.0      5.4      4.3     -2.1      3.6
          IV      0.8      2.9       2.1      3.1      -0.6       2.3      2.8      2.4      7.5      3.0

      ANNUAL      1.1      2.7       1.6      3.8       0.5       2.7      3.0      2.8      7.0      3.3

2006       I      1.5      4.2       2.6      3.7       0.0       2.2      0.9      1.8      8.2      2.6
          II      0.5      2.8       2.3      3.4      -0.5       2.9      2.3      2.8      1.9      2.7
         III      1.7      4.0       2.3      2.3      -1.0       0.6     -1.1      0.2     17.0      2.1
          IV      1.4      3.2       1.8      4.6       2.6       3.2      1.5      2.7     -5.9      1.7

      ANNUAL      1.3      3.5       2.2      3.5       0.2       2.2      0.9      1.9      5.0      2.2

2007       I      0.8      2.1       1.3      4.5       2.0       3.6      1.8      3.2     -6.1      2.0
          II     r2.2      3.2      r1.0     r5.7      r2.9       3.4      0.0      2.5    r-4.5     r1.6
----------------------------------------------------------------------------------------------------------
See footnotes following Table 6.                                        November 7, 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 
-1.6 and +1.4 index points approximately 95 percent of the time.  This 
interval is based on the performance of this measure between the fourth 
quarter of 1995 and the first quarter of 2007.

			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.