U.S. Manufacturing Productivity Increased 4.1% in First Quarter

Business productivity increased 1.9%

As output decreased 0.3%, manufacturing output increased 4.1% in the first quarter of 2008, as reported on May 7 by the Bureau of Labor Statistics of the U.S. Department of Labor.

The hours of the manufacturing workforce dropped. 4.2%. The decrease reflects a 2.8% decline in durable goods hours and a 6.6% drop in hours worked in nondurable goods industries. Productivity rose 2.3% in durable manufacturing and 7% in nondurable manufacturing.

The hourly compensation of all manufacturing workers increased 6.7% during the first quarter of 2008 and real hourly compensation rose 2.3%. Because hourly compensation of manufacturing workers rose more rapidly than productivity, unit labor costs increased in the first quarter, by 2.5%. Unit labor costs increased 4.1% in durable goods manufacturing and fell 0.4% in nondurable goods manufacturing.

In the business sector productivity increased by 1.9%. The Department of Labor said this was due primarily to the decline in hours worked.

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