Measuring Quarterly Labor Productivity by Industry

By Eldridge, Lucy P.; Price, Jennifer | Monthly Labor Review, June 2016 | Go to article overview

Measuring Quarterly Labor Productivity by Industry


Eldridge, Lucy P., Price, Jennifer, Monthly Labor Review


Timely statistics on output, employment, and productivity are essential to understanding the performance of the U.S. economy. This study examines newly available quarterly GDP-by-industry statistics to determine whether they can be used to produce reasonable quarterly labor productivity measures at the industry level. The results show that the quarterly labor-productivity data at the industry level can provide insights into which industries are driving current aggregate economic performance. However, the quarterly industry data are highly volatile and are most useful when evaluated in conjunction with long-run trends in order to more precisely assess the business cycle dynamics.

Timely statistics on output, employment, and productivity are essential to understanding the performance of the U.S. economy. Labor productivity indicates how effectively labor inputs are converted into output and provides information needed to assess changes in technology, labor share, living standards, and competitiveness. The U.S. Bureau of Labor Statistics (BLS) produces both quarterly labor productivity measures for broad sectors of the U.S. economy and annual labor productivity measures for industries. (1) Quarterly labor productivity data are analyzed as indicators of cyclical changes in the economy and are closely watched by the financial community, nonfinancial businesses, government policymakers, and researchers. Industry-level productivity statistics provide a means for comparing trends in efficiency and in technological improvements across industries, and indicate which industries are contributing to growth in the overall economy. Although annual industry productivity data can be used to analyze past industry performance and long-term trends, they are not frequent enough to provide indicators of current industry performance or identify which industries are driving current aggregate economic performance. Industry-level labor input data are available on a quarterly basis, but corresponding quarterly industry-level output data for nonmanufacturing industries--data that are necessary for constructing labor productivity measures--have not been available until recently.

In April 2014, the U.S. Bureau of Economic Analysis (BEA) began releasing quarterly gross domestic product (GDP)-by-industry measures. (2) These new output measures were developed to be consistent with the annual industry accounts, and they appear to provide the data needed to construct more timely labor productivity measures. However, because complete output data are not yet available for all industries on a quarterly basis, these higher frequency data rely on assumptions about the relationships among industry inputs, outputs, and value added from the annual and benchmark statistics. This study examines the new quarterly GDP-by-industry statistics to determine whether they can be used to produce reasonable quarterly labor productivity measures at the industry level. This study develops quarterly labor hours and labor productivity measures for the 20 private industry groups for which BEA is releasing GDP-by-industry data. (3) In addition, the study evaluates the volatility in the quarterly productivity measures to determine the value of these industry data for better understanding the sources of economic growth--in order to provide recommendations.

BLS labor productivity measures

The preliminary and revised quarterly press release--"Productivity and Costs"--includes measures of labor productivity for six major U.S. sectors: business, nonfarm business, manufacturing, durable and nondurable goods manufacturing, and nonfinancial corporations. (4) Labor productivity measures are calculated as growth in real output relative to growth in hours worked. BLS calculates quarterly labor productivity for the business and nonfarm business sectors by combining real output from the National Income and Product Accounts (NIPA), produced by the BEA, with measures of hours worked, prepared by the BLS Productivity Program. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Measuring Quarterly Labor Productivity by Industry
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.