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                           PRODUCTIVITY AND COSTS
                     Preliminary Fourth-Quarter Measures
                          and Annual Averages, 1999


     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 fourth quarter and for the full year 1999.  In the fourth
quarter, productivity advanced 4.8 percent in the business sector as output
grew 6.7 percent and hours worked rose 1.9 percent (seasonally adjusted
annual rates).  In the nonfarm business sector, productivity rose 5.0 percent
as output increased 6.6 percent and hours grew 1.5 percent.

                                     Fourth     Annual averages
                                     quarter      1998-1999
     Business sector                    4.8          3.0
     Nonfarm business sector            5.0          2.9
     
     For the year 1999, the increases in productivity in business and nonfarm
business, 3.0 and 2.9 percent, respectively, were slightly higher than the
increases reported in the previous year.  Fourth-quarter productivity and
related measures are summarized in table A and annual data in table B.
Detailed information is presented in tables 1 through 5.

     In the manufacturing sector, increases in productivity were:

                                     Fourth     Annual averages
                                     quarter      1998-1999
     Manufacturing sector              10.7          6.4
       Durable goods manufacturing     10.7          9.6
       Nondurable goods manufacturing  10.5          2.5

     Manufacturing productivity grew at a 10.7 percent annual rate in the
fourth quarter, reflecting a 7.3-percent rise in output and a drop of 3.0
percent in hours of all persons working in the sector.  On an annual basis,
manufacturing productivity increased 6.4 percent in 1999--the largest
increase since a 6.9-percent rise in 1971.  (Output and hours in
manufacturing, which includes about 17 percent of U.S. business-sector
employment, tend to vary more from quarter to quarter than data for the more
aggregate business and nonfarm business sectors.)

-------------------------------------------------------------------
Table A. Productivity and costs: Preliminary fourth-quarter 1999
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            4.8       6.7     1.9    3.6      0.6      -1.2
Nonfarm business    5.0       6.6     1.5    4.0      1.1      -1.0
Manufacturing      10.7       7.3    -3.0    4.3      1.3      -5.8
  Durable          10.7       6.9    -3.4    4.8      1.8      -5.3
  Nondurable       10.5       7.8    -2.4    3.6      0.7      -6.2
-------------------------------------------------------------------
                      Percent change from same quarter a year ago
Business            3.3       4.7     1.4    4.5      1.9       1.2
Nonfarm business    3.3       4.8     1.4    4.4      1.8       1.1
Manufacturing       6.9       4.8    -2.0    5.1      2.5      -1.7
  Durable           9.0       7.0    -1.8    5.4      2.7      -3.3
  Nondurable        4.3       2.0    -2.2    4.7      2.1       0.4
-------------------------------------------------------------------

     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.


                    THIRD-TO-FOURTH QUARTER CHANGES, 1999

Business

     Productivity in the business sector grew 4.8 percent in the fourth
quarter of 1999, reflecting an increase of 6.7 percent in output combined
with a 1.9 percent rise in the hours of all persons engaged in the sector.
In the third quarter of 1999, productivity rose 4.7 percent (as revised) as
output grew 6.5 percent and hours rose 1.7 percent (seasonally adjusted
annual rates).

     Hourly compensation increased at a 3.6 percent annual rate in the fourth
quarter of 1999, following an increase of 4.5 percent in the previous
quarter.  This measure includes wages and salaries, supplements, employer
contributions to employee-benefit plans, and taxes.  Unit labor costs, which
reflect changes in both hourly compensation and productivity, decreased at a
1.2 percent annual rate during the fourth quarter.  This was the largest drop
in this measure since the first quarter of 1996, when unit labor costs fell
1.6 percent.  During the third quarter of 1999, unit labor costs declined 0.2
percent.

     Real hourly compensation, which takes into account changes in consumer
prices, rose at a 0.6 percent annual rate for persons in the business sector.
This measure rose 1.9 percent during the third quarter.

     The implicit price deflator for business output, which reflects changes
in both unit labor costs and unit nonlabor payments, increased at an annual
rate of 1.8 percent in the fourth quarter of 1999.  This measure increased
0.6 percent in the third quarter.

Nonfarm business

     In the nonfarm business sector, productivity increased 5.0 percent in
both the third and fourth quarters of 1999 (seasonally adjusted annual
rates). These productivity gains were the largest in the nonfarm business
sector since the fourth quarter of 1992, when output per hour increased 7.4
percent.  In the fourth quarter of 1999, output rose 6.6 percent and hours of
all persons--employees, proprietors, and unpaid family workers--rose 1.5
percent.  These changes also were similar to those reported in the third
quarter of 1999, when output and hours increased 6.8 percent and 1.7 percent,
respectively (table 2).

     Hourly compensation in the nonfarm business sector rose 4.0 percent in
the fourth quarter, and real hourly compensation increased 1.1 percent when
the increase in consumer prices was taken into account.  During the third
quarter, hourly compensation had increased by 4.7 percent, and real hourly
compensation had risen 2.0 percent.

     Unit labor costs fell 1.0 percent in the fourth quarter, after declining
0.3 percent in the third quarter.  The implicit price deflator for nonfarm
business output rose 2.1 percent in the fourth quarter of 1999, reflecting
both the drop in unit labor costs and a large increase in unit nonlabor
payments (7.5 percent).

Manufacturing

     Manufacturing productivity grew at a 10.7 percent seasonally adjusted
annual rate in the fourth quarter of 1999 as output rose 7.3 percent and
hours fell 3.0 percent (table 3).  Productivity also rose 10.7 percent in
durable goods manufacturing, where output rose 6.9 percent and hours dropped
3.4 percent (table 4).  Among nondurable goods manufacturers, productivity
rose 10.5 percent in the fourth quarter as output grew 7.8 percent and hours
declined 2.4 percent (table 5).  In the third quarter, total manufacturing
productivity increased 4.4 percent (as revised), reflecting a 4.6-percent
rise in output and a 0.2 percent growth in hours of all persons.

     The average hourly compensation of manufacturing workers increased 4.3
percent in the fourth quarter.  This increase reflected a rise of 4.8 percent
in durable goods manufacturing and 3.6 percent in nondurable goods
manufacturing  When the increase in consumer prices was taken into account,
real hourly compensation in total manufacturing rose 1.3 percent.

     Since the fourth-quarter increase in manufacturing productivity outpaced
the increase in hourly compensation, unit labor costs for the manufacturing
sector fell 5.8 percent.  This was the sharpest one-quarter decline in the
measure since a 6.9-percent drop in the second quarter of 1961.  Unit labor
costs in the fourth quarter of 1999 fell 5.3 percent in durable goods
manufacturing and 6.2 percent in nondurable goods manufacturing.


                      AVERAGE ANNUAL CHANGES, 1998-1999

Business

     Business sector productivity increased 3.0 percent when the annual
average for 1999 is compared with the annual average for 1998 (table B). This
was the largest annual productivity increase since 1992, when output per hour
grew 4.3 percent.  Output rose 4.6 percent in 1999, and hours of all persons
engaged in the sector grew 1.5 percent.  The 1999 productivity increase was
only slightly larger than the 2.8-percent rise posted in 1998, when output
increased 5.1 percent and hours rose 2.2 percent.
     
----------------------------------------------------------------------------     
 Table B. Annual changes in productivity and related measures, 1990-1999
----------------------------------------------------------------------------
        Measure            1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
----------------------------------------------------------------------------
 Business:                                                                         
  Productivity              1.3  1.5  4.3  0.1  1.3  0.7  2.9  2.2  2.8  3.0
  Output                    1.5 -0.9  4.0  2.7  4.8  3.2  4.5  5.4  5.1  4.6
  Hours                     0.2 -2.3 -0.3  2.6  3.5  2.4  1.5  3.1  2.2  1.5
  Hourly compensation       5.7  4.8  5.3  2.4  2.0  2.1  3.2  3.7  5.3  5.0
  Real hourly compensation  0.6  1.0  2.7 -0.1 -0.2 -0.6  0.5  1.5  3.9  2.9
  Unit labor costs          4.3  3.2  1.0  2.3  0.7  1.4  0.3  1.5  2.4  1.9
----------------------------------------------------------------------------
 Nonfarm Business:
  Productivity              1.1  1.6  4.1  0.1  1.3  1.0  2.7  2.0  2.8  2.9
  Output                    1.4 -0.9  3.9  3.0  4.7  3.4  4.4  5.3  5.2  4.7
  Hours                     0.3 -2.4 -0.2  2.9  3.3  2.4  1.7  3.3  2.4  1.7
  Hourly compensation       5.5  4.9  5.3  2.1  2.1  2.1  3.1  3.6  5.2  4.8
  Real hourly compensation  0.5  1.1  2.7 -0.4 -0.1 -0.6  0.4  1.4  3.8  2.6
  Unit labor costs          4.3  3.3  1.2  2.1  0.8  1.1  0.4  1.6  2.4  1.8
----------------------------------------------------------------------------
 Manufacturing:                                                                    
  Productivity              2.5  2.3  5.1  2.2  3.1  3.9  4.1  5.0  4.8  6.4
  Output                    0.4 -2.0  4.7  3.6  5.3  4.3  3.7  6.9  4.9  4.2
  Hours                    -2.1 -4.2 -0.4  1.4  2.2  0.4 -0.4  1.8  0.1 -2.1
  Hourly compensation       4.8  5.3  4.6  2.7  2.8  2.1  1.3  3.7  5.3  5.0
  Real hourly compensation -0.2  1.5  2.0  0.2  0.6 -0.5 -1.3  1.5  3.9  2.8
  Unit labor costs          2.2  2.9 -0.4  0.5 -0.2 -1.7 -2.6 -1.3  0.5 -1.4
----------------------------------------------------------------------------
                                                                            
     Hourly compensation in the business sector rose 5.0 percent in 1999,
about the same as the 5.3 percent rise in 1998.  Real hourly compensation
grew 2.9 percent in 1999, following an increase of 3.9 percent in 1998.  Unit
labor costs rose 1.9 percent in 1999, compared with a 2.4 percent increase in
the previous year.  The implicit price deflator rose 0.9 percent in 1999 and
0.7 percent in 1998.

Nonfarm business

     Productivity increased 2.9 percent in the nonfarm business sector during
1999, about the same as the 2.8 percent rise in 1998.  During 1999, output
rose 4.7 percent, and hours of all persons increased 1.7 percent.  The
increase in labor productivity in 1998 resulted from faster growth in both
output and hours, 5.2 and 2.4 percent, respectively.
     
     In 1999, hourly compensation rose 4.8 percent, compared with a 5.2
percent increase in 1998.  Real hourly compensation increased 2.6 percent in
1999.  Unit labor costs in the nonfarm business sector grew 1.8 percent in
1999, slightly less than the 2.4-percent increase in 1998.  The implicit
price deflator for nonfarm business rose 0.9 percent in 1999, similar to the
0.8 percent rise one year earlier.
     
Manufacturing

     Manufacturing productivity grew 6.4 percent in 1999 as output rose 4.2
percent and hours of all persons fell 2.1 percent (table B).  In durable
goods manufacturing, productivity increased 9.6 percent in 1999, reflecting
an output increase of 7.3 percent and a drop in hours of all persons of 2.1
percent.  A much smaller increase in labor productivity in nondurable goods
manufacturing in 1999, 2.5 percent, was the result of a 0.3 percent rise in
output coupled with a 2.1-percent decline in hours of all persons.

     Hourly compensation of manufacturing workers increased 5.0 percent in
1999, down somewhat from the 5.3-percent increase in 1998.  Taking into
account the rise in consumer prices, real hourly compensation in
manufacturing rose 2.8 percent in 1999.  This increase was smaller than the
3.9-percent growth recorded in the previous year.

     Unit labor costs in manufacturing fell 1.4 percent in 1999; these costs
have now dropped in six of the past eight years.  Unit labor costs in durable
goods manufacturing fell 4.2 percent in 1999--the eighth consecutive drop in
unit labor costs in this sector.  In contrast, unit labor costs in nondurable
goods rose 2.3 percent in 1999.  This increase was smaller than the 3.8-
percent rise recorded in the previous year.
     
Revised Measures

     Current and previous measures for the third quarter of 1999 for the
business, nonfarm business, and manufacturing sectors are compared in table C.
Results for the business and nonfarm business sectors are similar to those
published on Dec. 7, based on the information then available.  In the
manufacturing sector, productivity and output growth is higher, and hourly
compensation and unit labor costs lower, than the figures published on Dec. 7.

-----------------------------------------------------------------
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
-----------------------------------------------------------------                                                            
                             Third quarter 1999
Business:                                                   
  Previous          4.7      6.3     1.6     4.6     1.9     -0.1
  Current           4.7      6.5     1.7     4.5     1.9     -0.2
Nonfarm business:                                           
  Previous          4.9      6.6     1.6     4.7     2.1     -0.2
  Current           5.0      6.8     1.7     4.7     2.0     -0.3
Manufacturing:                                              
  Previous          3.9      4.2     0.3     6.3     3.6      2.3
  Current           4.4      4.6     0.2     6.0     3.3      1.5
-----------------------------------------------------------------

Revised measures: Nonfinancial Corporations

     Revised productivity and output for the third quarter for nonfinancial
corporations were lower than those reported on Dec. 7 (table D).  Unit labor
costs grew at an annual rate of 0.4 percent in the third quarter, compared
with the 0.1 percent decline reported on Dec. 7.  Small upward revisions to
the output measures for the first and second quarters of 1999 also were
incorporated.

--------------------------------------------------------------------------
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
--------------------------------------------------------------------------                                                                  
                            Third quarter 1999
Previous   4.7     7.1     2.3    4.6      2.0    -0.1    -8.0     -0.3
Current    4.1     6.6     2.4    4.5      1.9     0.4    -9.7     -0.1
--------------------------------------------------------------------------
                                      
                              Next release date

     The next release of Productivity and Costs is scheduled for 8:30 A.M.
EST, Tuesday, March 7, 2000.  Revised fourth-quarter and annual measures for
business, nonfarm business, and manufacturing will be released at that time.

     Productivity and Costs is now available through an e-mail subscription
service.  Please see the subscription link on the BLS internet site
(http://stats.bls.gov/newsrels.htm).


TECHNICAL NOTES

Labor Hours: Hours data for the labor productivity and costs measures include
hours for all persons working in the sector-wage and salary workers, the self-
employed, and unpaid family workers.  The primary source of hours and
employment data is the BLS Current Employment Statistics (CES) program, which
provides monthly survey data on the number of jobs held by wage and salary
workers in nonfarm establishments.  The CES also provides average weekly paid
hours of production and nonsupervisory workers in these establishments.
Average weekly paid hours of nonproduction and supervisory workers are
estimated by the Office of Productivity and Technology.  Weekly paid hours are
adjusted to hours at work using the BLS Hours at Work survey, conducted for
this purpose.
	Data from the BLS Current Population Survey (CPS) are used for farm
labor; in the nonfarm sector, the National Income and Product Accounts (NIPA)
prepared by the Bureau of Economic Analysis (BEA) of the Department of
Commerce and the CPS are used to measure labor input for government
enterprises, proprietors, and unpaid family workers.

Output: Business sector output is an annual-weighted index constructed after
excluding from gross domestic product (GDP) the following outputs: General
government, nonprofit institutions, paid employees of private households, and
the rental value of owner-occupied dwellings. Corresponding exclusions also
are made in labor inputs. Business output accounted for about 77 percent of
the value of GDP in 1996. Nonfarm business, which also excludes farming,
accounted for about 76 percent of GDP in 1996.
	Annual indexes for manufacturing and its durable and nondurable goods
components are constructed by deflating current-dollar industry value of
production data from the U.S. Bureau of the Census with deflators from the
BEA.   These deflators are based on data from the BLS producer price program
and other sources.  The industry shipments are aggregated using annual
weights, and intrasector transactions are removed.  Quarterly manufacturing
output measures are based on the index of industrial production prepared
monthly by the Board of Governors of the Federal Reserve System adjusted to
be consistent with annual indexes of manufacturing sector output prepared by
BLS.  Durables include the following 2-digit SIC industries: Primary metal
industries; fabricated metal products; nonelectrical machinery; industrial and
commercial machinery and computer equipment; electronic and other electrical
equipment; transportation equipment; instruments; lumber and lumber products;
furniture and fixtures; stone, clay, and glass and concrete products; and
miscellaneous manufactures. Nondurables include: Food and kindred products,
tobacco products, textile mill products, apparel products, paper and allied
products, printing and publishing, chemicals and chemical products, petroleum
refining and related industries, rubber and plastic products, and leather and
leather products.
	Nonfinancial corporate output is an annual-weighted index constructed
by excluding from GDP the following outputs: General government; nonprofit
institutions; employees of private households; the rental value of owner-
occupied dwellings; unincorporated business; and those corporations which are
depository institutions, nondepository institutions, security and commodity
brokers, insurance carriers, regulated investment offices, small business
investment offices, and real estate investment trusts. Nonfinancial
corporations accounted for about 54 percent of the value of GDP in 1996.

Productivity: These productivity measures describe the relationship between
real output and the labor time involved in its production. They show the
changes from period to period in the amount of goods and services produced
per hour. Although these measures relate output to hours at work of all
persons engaged in a sector, they do not measure the specific contribution of
labor, capital, or any other factor of production. Rather, they reflect the
joint effects of many influences, including changes in technology; capital
investment; level of output; utilization of capacity, energy, and materials;
the organization of production; managerial skill; and the characteristics and
effort of the work force.

	Information in this release will be made available to sensory-
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  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

  1997       I     106.3      120.0     112.9     112.5       100.1      105.9       114.5      109.1
            II     107.1      121.8     113.7     113.2       100.4      105.7       115.9      109.5
           III     108.1      123.2     114.0     114.6       101.2      106.0       116.0      109.7
            IV     108.4      124.4     114.7     116.4       102.4      107.4       114.1      109.9

        ANNUAL     107.5      122.3     113.8     114.2       101.1      106.2       115.1      109.5

  1998       I     109.7      126.9     115.7     117.8       103.4      107.5       114.2      110.0
            II     109.8      127.5     116.1     119.4       104.4      108.8       112.6      110.2
           III     110.7      128.9     116.4     121.2       105.6      109.5       112.1      110.4
            IV     111.9      131.2     117.2     122.7       106.5      109.6       112.1      110.5

        ANNUAL     110.5      128.6     116.4     120.3       105.1      108.8       112.7      110.3

  1999       I     112.7      132.5     117.5     124.2       107.4      110.2       112.1      110.9
            II     113.0      133.1     117.8     125.7       107.8      111.3       110.9      111.2
           III     114.3     r135.2     118.3     127.1       108.3      111.3       111.5      111.4
            IV     115.6      137.4     118.9     128.3       108.5      110.9       113.5      111.9

        ANNUAL     113.9      134.5     118.1     126.3       108.1      110.9       112.0      111.3

  ---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

  1997       I       1.3        5.8       4.4       3.4         1.0        2.1         2.4        2.2
            II       3.4        6.2       2.7       2.6         1.5       -0.7         4.9        1.4
           III       3.6        4.8       1.1       4.8         3.0        1.1         0.2        0.8
            IV       1.2        3.9       2.7       6.7         4.8        5.4        -6.2        0.7

        ANNUAL       2.2        5.4       3.1       3.7         1.5        1.5         1.4        1.5

  1998       I       4.6        8.1       3.4       4.9         4.2        0.3         0.4        0.4
            II       0.6        2.2       1.6       5.5         3.9        4.9        -5.6        0.8
           III       3.4        4.4       0.9       6.1         4.7        2.6        -1.9        0.9
            IV       4.3        7.2       2.8       4.9         3.3        0.6        -0.1        0.4

        ANNUAL       2.8        5.1       2.2       5.3         3.9        2.4        -2.1        0.7

  1999       I       3.0        3.9       0.9       4.9         3.6        1.9         0.2        1.3
            II       0.8        1.9       1.0       5.1         1.5        4.2        -4.1        1.1
           III       4.7       r6.5      r1.7      r4.5         1.9      r-0.2        r2.1       r0.6
            IV       4.8        6.7       1.9       3.6         0.6       -1.2         7.2        1.8

        ANNUAL       3.0        4.6       1.5       5.0         2.9        1.9        -0.6        0.9

  ---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

  1997       I       2.1        5.5       3.4       3.6         0.8        1.5         1.7        1.6
            II       1.7        5.1       3.3       3.2         1.0        1.4         1.7        1.5
           III       2.6        5.7       3.0       3.5         1.4        0.9         2.1        1.4
            IV       2.4        5.2       2.7       4.4         2.6        1.9         0.2        1.3

        ANNUAL       2.2        5.4       3.1       3.7         1.5        1.5         1.4        1.5

  1998       I       3.2        5.8       2.5       4.7         3.4        1.5        -0.3        0.8
            II       2.5        4.7       2.2       5.5         4.0        2.9        -2.8        0.7
           III       2.4        4.6       2.1       5.8         4.4        3.3        -3.4        0.7
            IV       3.2        5.5       2.2       5.4         4.0        2.1        -1.8        0.6

        ANNUAL       2.8        5.1       2.2       5.3         3.9        2.4        -2.1        0.7

  1999       I       2.8        4.4       1.6       5.4         3.8        2.5        -1.9        0.8
            II       2.9        4.3       1.4       5.3         3.2        2.3        -1.5        0.9
           III       3.2       r4.9       1.6       4.9         2.6       r1.6        -0.5        0.8
            IV       3.3        4.7       1.4       4.5         1.9        1.2         1.3        1.2

        ANNUAL       3.0        4.6       1.5       5.0         2.9        1.9        -0.6        0.9

  ---------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                       February 8, 2000
  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

  1997       I     106.1      120.2     113.3     112.2        99.8      105.7       115.0      109.1
            II     106.9      122.0     114.1     112.9       100.1      105.6       116.6      109.6
           III     107.8      123.4     114.5     114.1       100.8      105.8       117.0      109.9
            IV     108.1      124.6     115.3     115.9       101.9      107.2       115.3      110.1

        ANNUAL     107.2      122.5     114.3     113.8       100.7      106.1       115.9      109.7

  1998       I     109.3      127.1     116.3     117.2       102.9      107.3       115.8      110.4
            II     109.5      127.9     116.8     118.8       103.9      108.5       114.1      110.5
           III     110.4      129.3     117.1     120.6       105.1      109.3       113.1      110.7
            IV     111.5      131.6     118.0     122.0       105.9      109.4       112.7      110.6

        ANNUAL     110.2      129.0     117.1     119.7       104.5      108.6       113.9      110.5

  1999       I     112.2      132.9     118.4     123.3       106.6      109.8       113.1      111.0
            II     112.4      133.5     118.7     124.7       106.9      111.0       112.2      111.4
           III     113.8     r135.7    r119.3    r126.1       107.5      110.9      r112.9      111.6
            IV     115.2      137.9     119.7     127.4       107.8      110.6       114.9      112.2

        ANNUAL     113.4      135.0     119.0     125.4       107.3      110.6       113.3      111.6

  ---------------------------------------------------------------------------------------------------------
                       Percent change from previous quarter at annual rate(5)

  1997       I       0.9        5.5       4.5       3.6         1.2        2.7         2.2        2.5
            II       3.3        6.2       2.8       2.6         1.5       -0.6         5.7        1.7
           III       3.3        4.6       1.3       4.4         2.6        1.0         1.3        1.1
            IV       1.2        4.1       2.9       6.4         4.5        5.1        -5.7        0.8

        ANNUAL       2.0        5.3       3.3       3.6         1.4        1.6         1.9        1.7

  1998       I       4.4        8.3       3.7       4.8         4.1        0.4         1.8        0.9
            II       0.9        2.4       1.4       5.6         3.9        4.6        -5.8        0.5
           III       3.1        4.4       1.2       6.2         4.7        3.0        -3.2        0.6
            IV       4.1        7.3       3.1       4.6         2.9        0.5        -1.6       -0.3

        ANNUAL       2.8        5.2       2.4       5.2         3.8        2.4        -1.8        0.8

  1999       I       2.7        4.0       1.3       4.2         2.8        1.4         1.5        1.5
            II       0.6        1.8       1.3       4.8         1.2        4.2        -3.1        1.4
           III      r5.0       r6.8      r1.7       4.7        r2.0      r-0.3        r2.5        0.7
            IV       5.0        6.6       1.5       4.0         1.1       -1.0         7.5        2.1

        ANNUAL       2.9        4.7       1.7       4.8         2.6        1.8        -0.5        0.9

  ---------------------------------------------------------------------------------------------------------
                      Percent change from corresponding quarter of previous year

  1997       I       1.8        5.4       3.6       3.5         0.7        1.7         1.8        1.7
            II       1.5        5.1       3.5       3.1         1.0        1.6         2.2        1.8
           III       2.3        5.5       3.1       3.5         1.4        1.1         2.9        1.8
            IV       2.2        5.1       2.9       4.2         2.4        2.0         0.8        1.5

        ANNUAL       2.0        5.3       3.3       3.6         1.4        1.6         1.9        1.7

  1998       I       3.0        5.8       2.7       4.5         3.2        1.5         0.7        1.2
            II       2.4        4.8       2.3       5.3         3.8        2.8        -2.2        0.9
           III       2.4        4.8       2.3       5.7         4.3        3.3        -3.3        0.7
            IV       3.1        5.6       2.4       5.3         3.9        2.1        -2.3        0.5

        ANNUAL       2.8        5.2       2.4       5.2         3.8        2.4        -1.8        0.8

  1999       I       2.7        4.5       1.7       5.1         3.6        2.4        -2.3        0.6
            II       2.6        4.4       1.7       4.9         2.9        2.3        -1.6        0.8
           III       3.1       r5.0       1.8       4.6        r2.2       r1.4       r-0.2        0.8
            IV       3.3        4.8       1.4       4.4         1.8        1.1         2.0        1.4

        ANNUAL       2.9        4.7       1.7       4.8         2.6        1.8        -0.5        0.9

  ---------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                       February 8, 2000
  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

  1997       I            116.9        122.7        105.0        111.8           99.5          95.7
            II            118.4        124.9        105.5        112.6           99.9          95.1
           III            120.9        127.3        105.3        113.6          100.3          94.0
            IV            122.0        129.6        106.2        115.5          101.5          94.6

        ANNUAL            119.6        126.1        105.5        113.4          100.4          94.8

  1998       I            122.7        130.6        106.4        117.0          102.7          95.3
            II            123.9        131.5        106.1        118.6          103.7          95.7
           III            126.3        132.6        105.0        120.6          105.1          95.5
            IV            128.2        134.4        104.9        121.4          105.4          94.7

        ANNUAL            125.3        132.3        105.6        119.4          104.3          95.3

  1999       I            130.4        135.2        103.7        122.8          106.2          94.1
            II            132.2        136.8        103.5        124.5          106.8          94.2
           III           r133.6       r138.4        103.6       r126.3         r107.6         r94.5
            IV            137.1        140.9        102.8        127.7          108.0          93.1

        ANNUAL            133.3        137.8        103.4        125.3          107.2          94.0

  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  1997       I              4.0          7.1          3.0          5.5            3.0           1.4
            II              5.5          7.4          1.8          2.9            1.8          -2.4
           III              8.4          7.8         -0.6          3.6            1.8          -4.5
            IV              3.9          7.4          3.3          6.8            4.9           2.7

        ANNUAL              5.0          6.9          1.8          3.7            1.5          -1.3

  1998       I              2.4          3.3          0.9          5.4            4.7           3.0
            II              3.9          2.6         -1.2          5.4            3.8           1.5
           III              7.8          3.4         -4.1          6.9            5.4          -0.9
            IV              6.1          5.6         -0.5          2.9            1.2          -3.1

        ANNUAL              4.8          4.9          0.1          5.3            3.9           0.5

  1999       I              7.3          2.5         -4.5          4.5            3.1          -2.7
            II              5.5          4.9         -0.5          5.8            2.2           0.3
           III             r4.4         r4.6         r0.2         r6.0           r3.3          r1.5
            IV             10.7          7.3         -3.0          4.3            1.3          -5.8

        ANNUAL              6.4          4.2         -2.1          5.0            2.8          -1.4

  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  1997       I              4.4          6.9          2.4          3.1            0.3          -1.2
            II              4.8          6.5          1.6          3.3            1.2          -1.4
           III              5.4          6.7          1.2          3.7            1.6          -1.6
            IV              5.5          7.4          1.9          4.7            2.9          -0.7

        ANNUAL              5.0          6.9          1.8          3.7            1.5          -1.3

  1998       I              5.0          6.5          1.4          4.7            3.3          -0.4
            II              4.6          5.3          0.6          5.3            3.8           0.6
           III              4.5          4.2         -0.3          6.1            4.7           1.6
            IV              5.0          3.7         -1.2          5.1            3.8           0.1

        ANNUAL              4.8          4.9          0.1          5.3            3.9           0.5

  1999       I              6.3          3.5         -2.6          4.9            3.4          -1.3
            II              6.7          4.1         -2.4          5.0            3.0          -1.6
           III             r5.8         r4.4        r-1.4         r4.8            2.5         r-1.0
            IV              6.9          4.8         -2.0          5.1            2.5          -1.7

        ANNUAL              6.4          4.2         -2.1          5.0            2.8          -1.4

  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                February 8, 2000
  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

  1997       I            125.6        137.5        109.5        109.4           97.3          87.1
            II            128.6        141.7        110.2        110.2           97.7          85.7
           III            131.9        145.6        110.4        110.9           98.0          84.1
            IV            134.3        149.3        111.2        113.2           99.5          84.3

        ANNUAL            130.1        143.5        110.3        110.9           98.2          85.3

  1998       I            135.7        151.7        111.8        114.7          100.7          84.5
            II            138.0        153.8        111.4        116.2          101.6          84.2
           III            142.4        157.1        110.4        118.3          103.0          83.1
            IV            145.7        160.8        110.4        118.9          103.2          81.6

        ANNUAL            140.4        155.9        111.0        117.0          102.2          83.3

  1999       I            149.1        162.0        108.7        120.3          104.0          80.7
            II            152.9        165.7        108.4        122.1          104.7          79.9
           III           r154.8       r169.1       r109.3       r123.8         r105.5         r80.0
            IV            158.8        172.0        108.3        125.3          106.0          78.9

        ANNUAL            153.9        167.2        108.7        122.9          105.1          79.9

  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  1997       I              4.8         10.9          5.8          5.6            3.1           0.7
            II              9.9         12.8          2.6          2.8            1.6          -6.5
           III             10.7         11.4          0.6          2.8            1.1          -7.2
            IV              7.4         10.6          3.0          8.3            6.3           0.8

        ANNUAL              7.1         10.2          2.9          3.3            1.1          -3.5

  1998       I              4.3          6.5          2.2          5.5            4.8           1.2
            II              7.1          5.7         -1.4          5.5            3.8          -1.5
           III             13.2          9.0         -3.7          7.2            5.7          -5.3
            IV              9.6          9.6          0.0          2.2            0.6          -6.8

        ANNUAL              7.9          8.6          0.6          5.5            4.1          -2.3

  1999       I              9.7          3.1         -6.0          4.6            3.2          -4.7
            II             10.5          9.3         -1.1          6.5            2.8          -3.7
           III             r5.1         r8.7         r3.4         r5.7           r3.0          r0.5
            IV             10.7          6.9         -3.4          4.8            1.8          -5.3

        ANNUAL              9.6          7.3         -2.1          5.0            2.9          -4.2

  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  1997       I              5.9          9.9          3.8          2.3           -0.4          -3.3
            II              6.6          9.4          2.6          2.9            0.7          -3.5
           III              7.5         10.0          2.3          3.2            1.1          -4.0
            IV              8.2         11.4          3.0          4.8            3.0          -3.1

        ANNUAL              7.1         10.2          2.9          3.3            1.1          -3.5

  1998       I              8.1         10.3          2.1          4.8            3.4          -3.0
            II              7.4          8.5          1.1          5.5            4.0          -1.7
           III              7.9          7.9          0.0          6.6            5.2          -1.2
            IV              8.5          7.7         -0.7          5.1            3.7          -3.2

        ANNUAL              7.9          8.6          0.6          5.5            4.1          -2.3

  1999       I              9.9          6.8         -2.8          4.8            3.3          -4.6
            II             10.7          7.7         -2.7          5.1            3.1          -5.1
           III             r8.7          7.6        r-1.0         r4.7           r2.4         r-3.7
            IV              9.0          7.0         -1.8          5.4            2.7          -3.3

        ANNUAL              9.6          7.3         -2.1          5.0            2.9          -4.2

  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                February 8, 2000
  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

  1997       I            109.8        108.8         99.0        114.8          102.1         104.5
            II            110.0        109.1         99.2        115.7          102.6         105.1
           III            111.7        110.1         98.6        117.0          103.3         104.8
            IV            111.6        111.0         99.5        118.2          104.0         105.9

        ANNUAL            110.8        109.8         99.1        116.4          103.0         105.1

  1998       I            111.7        110.9         99.3        119.7          105.1         107.2
            II            111.6        110.6         99.1        121.3          106.1         108.7
           III            112.0        109.6         97.9        123.1          107.3         109.9
            IV            112.6        109.8         97.5        124.3          107.9         110.4

        ANNUAL            112.0        110.2         98.4        122.1          106.6         109.0

  1999       I            113.7        110.3         97.0        125.7          108.7         110.6
            II            113.4        110.1         97.1        127.2          109.1         112.2
           III           r114.5       r109.9        r96.0       r129.0         r109.9        r112.7
            IV            117.4        112.0         95.4        130.2          110.1         110.9

        ANNUAL            114.7        110.6         96.4        128.0          109.5         111.6

  --------------------------------------------------------------------------------------------------
                         Percent change from previous quarter at annual rate(5)

  1997       I              3.9          3.0         -0.9          4.8            2.3           0.8
            II              0.7          1.3          0.7          3.1            1.9           2.4
           III              6.1          3.5         -2.4          4.6            2.9          -1.4
            IV             -0.2          3.6          3.7          4.4            2.5           4.6

        ANNUAL              3.1          3.2          0.1          4.1            1.9           1.0

  1998       I              0.3         -0.6         -0.9          5.0            4.3           4.7
            II             -0.3         -1.1         -0.9          5.4            3.8           5.7
           III              1.5         -3.3         -4.7          6.2            4.8           4.6
            IV              1.8          0.5         -1.3          3.9            2.2           2.0

        ANNUAL              1.1          0.4         -0.6          4.9            3.5           3.8

  1999       I              4.0          1.8         -2.1          4.6            3.2           0.6
            II             -1.0         -0.8          0.3          4.9            1.3           5.9
           III             r4.2        r-0.5        r-4.4         r5.9           r3.2          r1.6
            IV             10.5          7.8         -2.4          3.6            0.7          -6.2

        ANNUAL              2.5          0.3         -2.1          4.9            2.7           2.3

  --------------------------------------------------------------------------------------------------
                     Percent change from corresponding quarter of previous year

  1997       I              3.2          3.6          0.4          4.0            1.2           0.8
            II              3.1          3.3          0.2          3.9            1.7           0.7
           III              3.4          2.9         -0.5          4.2            2.1           0.8
            IV              2.6          2.9          0.2          4.2            2.4           1.6

        ANNUAL              3.1          3.2          0.1          4.1            1.9           1.0

  1998       I              1.7          1.9          0.2          4.3            2.9           2.6
            II              1.5          1.3         -0.1          4.9            3.4           3.4
           III              0.3         -0.4         -0.7          5.3            3.9           4.9
            IV              0.8         -1.1         -2.0          5.1            3.8           4.3

        ANNUAL              1.1          0.4         -0.6          4.9            3.5           3.8

  1999       I              1.8         -0.5         -2.3          5.0            3.5           3.2
            II              1.6         -0.4         -2.0          4.9            2.9           3.3
           III             r2.2         r0.3        r-1.9         r4.8           r2.5          r2.5
            IV              4.3          2.0         -2.2          4.7            2.1           0.4

        ANNUAL              2.5          0.3         -2.1          4.9            2.7           2.3

  --------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                February 8, 2000
  r=revised                                                       Source: Bureau of Labor Statistics

Table 6. Nonfinancial corporations:   Productivity, hourly compensation, unit labor costs, unit profits,
  and prices, seasonally adjusted
 
                Output                      Hourly    Real                Unit     Total    Unit   Implicit
      Year      per all-                    compen-   hourly     Unit     non-     unit     pro-   price
      and       employee          Employee  sation    compen-    labor    labor    costs    fits   deflator
      quarter   hour      Output  hours      (1)      sation(2)  costs    costs(6) (7)      (8)      (4)
  ----------------------------------------------------------------------------------------------------------
                                             Indexes 1992=100

  1997       I    110.1    125.5     114.0    111.2      98.9     101.0     99.8    100.7    155.6    105.3
            II    110.7    127.5     115.1    112.0      99.3     101.1     99.9    100.8    156.2    105.4
           III    112.4    130.2     115.8    113.3     100.0     100.7     99.2    100.3    161.1    105.4
            IV    113.2    132.3     116.9    115.1     101.2     101.6     98.6    100.8    155.3    105.3

        ANNUAL    111.7    128.9     115.4    113.0     100.0     101.1     99.4    100.6    157.1    105.3

  1998       I    114.2    134.6     117.8    116.4     102.2     101.9     98.0    100.8    153.7    105.2
            II    115.3    136.3     118.1    118.0     103.2     102.3     98.2    101.2    150.1    105.2
           III    117.0    138.7     118.6    119.8     104.4     102.4     98.0    101.2    152.6    105.5
            IV    117.9    140.6     119.3    121.3     105.3     102.9     99.2    101.8    145.3    105.5

        ANNUAL    116.2    137.5     118.4    119.0     103.9     102.4     98.4    101.3    150.4    105.3

  1999       I    119.1   r142.7     119.7    122.7     106.1     103.0    r98.3    101.7   r149.4    105.7
            II   r120.1   r144.2     120.0    124.2     106.5     103.4    r98.7    102.1   r148.4   r105.9
           III   r121.3   r146.5    r120.8   r125.5     107.0    r103.5    r99.6   r102.4   r144.7    105.9
  ----------------------------------------------------------------------------------------------------------
                             Percent change from previous quarter at annual rate(5)

  1997       I      1.8      6.1       4.3      3.6       1.2       1.8     -0.3      1.2      4.6      1.6
            II      2.3      6.4       4.0      2.7       1.5       0.3      0.5      0.4      1.6      0.5
           III      6.3      8.9       2.5      4.7       2.9      -1.5     -2.6     -1.8     13.0     -0.1
            IV      2.8      6.4       3.5      6.5       4.6       3.6     -2.5      1.9    -13.6     -0.2

        ANNUAL      3.0      6.6       3.5      3.6       1.4       0.6     -0.7      0.2      3.7      0.6

  1998       I      3.7      7.1       3.3      4.8       4.1       1.1     -2.6      0.0     -4.1     -0.5
            II      3.9      5.1       1.2      5.7       4.1       1.7      0.9      1.5     -9.1      0.2
           III      5.9      7.5       1.5      6.3       4.8       0.4     -0.7      0.1      6.8      0.9
            IV      3.2      5.6       2.3      4.9       3.3       1.7      4.9      2.6    -17.8     -0.1

        ANNUAL      4.0      6.7       2.6      5.3       3.9       1.3     -1.0      0.6     -4.3      0.0

  1999       I     r4.2     r5.9       1.6      4.7       3.3      r0.5    r-3.5    r-0.7    r11.9     r0.7
            II     r3.3     r4.3       1.0      4.8       1.3      r1.4     r1.6     r1.5    r-2.7     r1.0
           III     r4.1     r6.6      r2.4     r4.5      r1.9      r0.4     r3.5     r1.2    r-9.7    r-0.1
  ----------------------------------------------------------------------------------------------------------
                          Percent change from corresponding quarter of previous year

  1997       I      2.6      6.2       3.5      3.5       0.7       0.8     -0.6      0.4      4.0      0.8
            II      2.5      6.2       3.5      3.1       0.9       0.6     -0.2      0.4      3.4      0.7
           III      3.6      7.2       3.5      3.5       1.4      -0.1     -0.6     -0.3      6.4      0.6
            IV      3.3      7.0       3.6      4.3       2.5       1.0     -1.2      0.4      0.9      0.5

        ANNUAL      3.0      6.6       3.5      3.6       1.4       0.6     -0.7      0.2      3.7      0.6

  1998       I      3.8      7.2       3.3      4.6       3.3       0.8     -1.8      0.1     -1.2     -0.1
            II      4.1      6.9       2.6      5.4       3.9       1.2     -1.7      0.4     -3.9     -0.1
           III      4.0      6.5       2.4      5.8       4.4       1.7     -1.2      0.9     -5.3      0.1
            IV      4.1      6.3       2.1      5.4       4.1       1.2      0.6      1.1     -6.5      0.1

        ANNUAL      4.0      6.7       2.6      5.3       3.9       1.3     -1.0      0.6     -4.3      0.0

  1999       I      4.3      6.0       1.7      5.4       3.9       1.1      0.4      0.9     -2.8     r0.4
            II      4.1     r5.8       1.6      5.2       3.2      r1.0     r0.5      0.9     -1.1     r0.6
           III     r3.7     r5.6       1.8      4.8       2.4      r1.0     r1.6     r1.2    r-5.2      0.4
  ----------------------------------------------------------------------------------------------------------
  See footnotes following Table 6.                                        February 8, 2000
  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 -1.9 and +2.5 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 third 
quarter of 1999.  



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 1978-1998 is based on the Consumer Price Index 
research series (CPI-U-RS).

(3)  Unit nonlabor payments include profits, capital consumption 
allowances, interest, rental income of persons, and 
indirect taxes.

(4)  Current dollar output divided by the output index.

(5)  Quarterly changes:  Percent change compounded at annual 
rate from the original data rather than index numbers.  
Annual changes:  Percent change between annual average 
levels.

(6)  Unit nonlabor costs include capital consumption allowances, 
interest, rental income of persons, and indirect taxes.  
For nonfinancial corporations, rental income of persons is 
zero by definition.

(7)  Total unit costs are the sum of unit labor and nonlabor 
costs.

(8)  Unit profits include corporate profits with inventory 
valuation and capital consumption adjustments.