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International Comparisons of Manufacturing Productivity and Unit Labor Cost Trends

Productivity growth in manufacturing increased in 2010 in all countries covered,
the U.S. Bureau of Labor Statistics reported today. In the majority of countries
labor productivity (output per hour) rose by more than 5 percent (see chart 1).
In the previous year, productivity fell in 12 of 19 countries. The productivity
increases in 2010 were driven by large gains in output coupled with modest changes
in hours (see chart 2). Output, after having fallen in all countries in 2009, rose
in all countries in 2010.   

The data presented for the United States differ from those in the BLS Productivity
and Costs news release. (See technical notes.)  

PRINTED COPY CONTAINS CHART AT THIS POINT:
Chart 1. Percent changes in manufacturing output per hour, 2009-2010

PRINTED COPY CONTAINS CHART AT THIS POINT:
Chart 2. Percent changes in manufacturing output and hours, 2009-2010

The 2010 growth in manufacturing labor productivity represents a reversal of the
previous year, where productivity fell in 12 of the 19 countries. In 2010,
productivity increased in all countries covered, and six countries experienced
productivity growth over 10 percent (see chart 3).  

PRINTED COPY CONTAINS CHART AT THIS POINT:
Chart 3. . Percent changes in manufacturing output per hour

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at www.bls.gov/ilc/#productivity.

Find additional data. 
The data tables with annual indexes and growth rates back to 1950 used to prepare
this report are available at www.bls.gov/ilc/#productivity. 

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Unit labor costs are the cost of labor input required to produce one unit of
output and can be expressed either in national currency units or in U.S. dollars.
Expressed in national currency units, manufacturing unit labor costs declined in
2010 in all countries covered; Singapore, Sweden, and Japan recorded the largest
drops (see chart 4). Unit labor costs in U.S. dollars showed even steeper declines
than the national currency valuations for most European countries, due to the
relative strength of the U.S. dollar. In 2010 unit labor costs in U.S. dollars
increased in four countries.

In 2010, U.S. manufacturing labor cost competitiveness declined relative to 13
countries because unit labor costs on a U.S. dollar basis decreased more in those
countries than in the United States. However, U.S. labor cost competitiveness
improved relative to the other 5 countries. The United States improved its
competiveness the most against Australia due to the large appreciation of the
Australian dollar against the U.S. dollar, which pushed Australian unit labor costs
up more than 10 percent on a U.S. dollar basis.

PRINTED COPY CONTAINS CHART AT THIS POINT:
Chart 4. Percent changes in manufacturing unit labor costs, 2009-2010







Table 1. Output per hour, output, and hours
         Manufacturing, 19 countries, 1979-2010
         Average annual compound rates of change

Country               Indicator                 1979-2010  1979-1990  1990-2000  2000-2007  2007-2010  2008-2009  2009-2010

United States         Output per hour                 4.1        3.0        4.3        6.0        3.3        5.0        5.8
                          Output                      2.5        2.3        4.2        2.8       -2.8       -8.6        5.8
                          Hours                      -1.5       -0.6       -0.1       -3.1       -5.8      -13.0        0.0

Australia             Output per hour                 2.0        2.1        1.9        2.4        1.0        4.4        1.6
                          Output                      1.4        1.6        1.5        1.6        0.3       -2.3        4.3
                          Hours                      -0.5       -0.5       -0.4       -0.8       -0.7       -6.5        2.7

Belgium               Output per hour                 3.0        4.2        2.8        1.8        1.8        1.9        3.3
                          Output                      1.4        2.6        1.5        0.7       -1.9       -8.3        3.9
                          Hours                      -1.5       -1.6       -1.2       -1.1       -3.6      -10.0        0.6

Canada                Output per hour                 2.2        2.1        3.6        0.9        0.8        0.9        4.3
                          Output                      1.4        1.9        4.2       -0.6       -4.2      -11.3        5.6
                          Hours                      -0.7       -0.2        0.5       -1.5       -5.0      -12.1        1.3

Czech Republic        Output per hour                 NA         NA         NA         7.4        5.1       -3.3       12.9
                          Output                      NA         NA         NA         7.4        1.7      -11.9       10.8
                          Hours                       NA         NA         NA         0.0       -3.2       -8.8       -1.9

Denmark               Output per hour                 2.5        2.2        2.3        3.0        3.5       -1.4        9.6
                          Output                      1.0        1.3        1.9        0.6       -2.3      -12.1        2.4
                          Hours                      -1.5       -1.0       -0.4       -2.4       -5.5      -10.9       -6.5

Finland               Output per hour                 5.3        5.0        6.5        7.0       -1.0      -14.0       16.4
                          Output                      3.7        3.4        5.5        6.2       -6.5      -24.8       12.8
                          Hours                      -1.5       -1.5       -0.9       -0.8       -5.5      -12.6       -3.2

France                Output per hour                 3.2        3.2        3.9        3.3        0.7       -2.0        7.9
                          Output                      0.9        0.9        1.9        1.2       -3.0       -8.1        3.5
                          Hours                      -2.3       -2.3       -1.9       -2.1       -3.8       -6.3       -4.0

Germany               Output per hour                 2.4        2.1        3.3        3.7       -2.5       -9.2        6.9
                          Output                      0.7        1.2        0.6        2.4       -4.4      -18.1       11.3
                          Hours                      -1.7       -0.9       -2.6       -1.3       -1.9       -9.8        4.1

Italy                 Output per hour                 2.0        3.4        2.6        0.3       -0.9       -6.1        7.0
                          Output                      0.9        2.6        1.4        0.3       -5.8      -16.0        4.6
                          Hours                      -1.1       -0.8       -1.2       -0.1       -4.9      -10.6       -2.3

Japan                 Output per hour                 3.5        3.8        3.4        3.8        2.2       -9.0       13.9
                          Output                      2.2        4.7        0.8        2.3       -2.3      -19.7       16.7
                          Hours                      -1.2        0.9       -2.4       -1.4       -4.4      -11.8        2.4

Korea, Republic of    Output per hour                 NA         NA        10.5        8.1        3.4        1.2        8.6
                          Output                      8.6       10.8        8.4        6.8        5.1       -1.5       14.8
                          Hours                       NA         NA        -1.9       -1.1        1.7       -2.7        5.7

Netherlands           Output per hour                 3.1        3.2        3.4        3.8        0.6       -4.7        9.1
                          Output                      2.0        2.4        2.7        2.0       -1.2       -8.6        7.3
                          Hours                      -1.1       -0.8       -0.7       -1.7       -1.7       -4.1       -1.7

Norway                Output per hour                 1.8        1.9        0.7        3.0        2.1        0.8        4.7
                          Output                      0.7       -0.5        1.0        2.6       -0.5       -5.8        1.9
                          Hours                      -1.1       -2.3        0.3       -0.3       -2.6       -6.5       -2.6

Singapore             Output per hour                 4.8        4.0        7.2        2.0        6.3       -0.3       32.7
                          Output                      6.8        7.3        7.4        5.5        6.0       -4.2       29.7
                          Hours                       1.9        3.2        0.2        3.5       -0.3       -3.9       -2.3

Spain                 Output per hour                 2.3        3.3        2.0        1.9        0.8       -0.8        4.7
                          Output                      1.4        2.1        2.8        1.2       -5.4      -13.6        0.9
                          Hours                      -0.9       -1.2        0.8       -0.6       -6.1      -12.9       -3.7

Sweden                Output per hour                 4.2        2.1        6.4        6.5       -0.3       -7.3       13.4
                          Output                      3.2        1.7        5.7        5.0       -3.5      -18.0       15.6
                          Hours                      -1.0       -0.4       -0.6       -1.5       -3.2      -11.5        2.0

Taiwan                Output per hour                 6.2        6.3        5.0        7.6        7.0        4.8       15.2
                          Output                      6.6        7.5        5.0        7.2        7.0       -4.4       26.7
                          Hours                       0.3        1.2       -0.1       -0.4       -0.1       -8.7       10.0

United Kingdom        Output per hour                 3.3        4.0        2.9        4.2        0.2       -3.7        4.2
                          Output                      0.3        0.9        0.9        0.0       -3.5      -10.7        3.6
                          Hours                      -2.9       -3.0       -1.9       -4.0       -3.7       -7.2       -0.6

NOTE: German data for years before 1991 pertain to the former West Germany.
NA=data not available.




Table 2. Unit labor costs (ULC) in national currency, compensation, and output
         Manufacturing, 19 countries, 1979-2010
         Average annual compound rates of change

Country               Indicator                 1979-2010  1979-1990  1990-2000  2000-2007  2007-2010  2008-2009  2009-2010

United States         ULC in nat. cur.                0.3        2.5       -0.4       -2.1        0.2       -0.5       -4.0
                      Compensation                    2.8        4.9        3.8        0.6       -2.6       -9.1        1.6
                      Output                          2.5        2.3        4.2        2.8       -2.8       -8.6        5.8

Australia             ULC in nat. cur.                NA         NA         1.7        3.0        1.3        2.2       -2.4
                      Compensation                    NA         NA         3.2        4.6        1.6       -0.2        1.9
                      Output                          1.4        1.6        1.5        1.6        0.3       -2.3        4.3

Belgium               ULC in nat. cur.                1.0        1.8        0.2        0.8        1.3        4.2       -3.2
                      Compensation                    2.4        4.4        1.6        1.6       -0.6       -4.4        0.6
                      Output                          1.4        2.6        1.5        0.7       -1.9       -8.3        3.9

Canada                ULC in nat. cur.                2.0        4.6       -0.3        2.7       -0.9       -2.4       -4.3
                      Compensation                    3.5        6.5        3.8        2.1       -5.0      -13.4        1.1
                      Output                          1.4        1.9        4.2       -0.6       -4.2      -11.3        5.6

Czech Republic        ULC in nat. cur.                NA         NA         NA        -0.2       -2.4        2.1       -7.6
                      Compensation                    NA         NA         NA         7.2       -0.7      -10.0        2.3
                      Output                          NA         NA         NA         7.4        1.7      -11.9       10.8

Denmark               ULC in nat. cur.                2.5        5.7        0.7        1.9       -0.8        4.3       -6.2
                      Compensation                    3.5        7.0        2.5        2.4       -3.1       -8.4       -4.0
                      Output                          1.0        1.3        1.9        0.6       -2.3      -12.1        2.4

Finland               ULC in nat. cur.                1.0        5.7       -2.2       -3.1        4.0       19.2      -11.1
                      Compensation                    4.7        9.4        3.3        2.9       -2.7      -10.4        0.2
                      Output                          3.7        3.4        5.5        6.2       -6.5      -24.8       12.8

France                ULC in nat. cur.                2.1        5.7       -0.2        0.1        1.8        5.0       -5.4
                      Compensation                    3.0        6.7        1.7        1.3       -1.3       -3.5       -2.0
                      Output                          0.9        0.9        1.9        1.2       -3.0       -8.1        3.5

Germany               ULC in nat. cur.                1.1        3.3        0.2       -2.3        4.4       21.9      -10.3
                      Compensation                    1.9        4.6        0.8        0.0       -0.1       -0.1       -0.2
                      Output                          0.7        1.2        0.6        2.4       -4.4      -18.1       11.3

Italy                 ULC in nat. cur.                4.7        8.8        1.7        2.8        4.2       10.3       -4.6
                      Compensation                    5.5       11.6        3.2        3.0       -1.8       -7.4       -0.2
                      Output                          0.9        2.6        1.4        0.3       -5.8      -16.0        4.6

Japan                 ULC in nat. cur.               -1.1        0.7       -0.9       -3.8       -1.7       11.1      -13.3
                      Compensation                    1.1        5.5       -0.1       -1.5       -4.0      -10.8        1.1
                      Output                          2.2        4.7        0.8        2.3       -2.3      -19.7       16.7

Korea, Republic of    ULC in nat. cur.                4.1        7.9        2.6        1.6        1.2        4.1       -0.7
                      Compensation                   13.0       19.5       11.3        8.5        6.4        2.5       14.0
                      Output                          8.6       10.8        8.4        6.8        5.1       -1.5       14.8

Netherlands           ULC in nat. cur.                0.5        0.8        0.3       -0.1        1.9        8.4       -7.7
                      Compensation                    2.6        3.2        3.0        1.9        0.7       -0.9       -1.0
                      Output                          2.0        2.4        2.7        2.0       -1.2       -8.6        7.3

Norway                ULC in nat. cur.                4.3        6.9        3.5        2.0        2.8        4.7       -0.7
                      Compensation                    5.0        6.4        4.6        4.6        2.3       -1.4        1.2
                      Output                          0.7       -0.5        1.0        2.6       -0.5       -5.8        1.9

Singapore             ULC in nat. cur.                0.3        3.7       -1.5       -1.1       -3.1       -0.2      -18.3
                      Compensation                    7.1       11.3        5.8        4.4        2.7       -4.3        6.0
                      Output                          6.8        7.3        7.4        5.5        6.0       -4.2       29.7

Spain                 ULC in nat. cur.                4.3        7.8        2.7        2.5        1.6        2.9       -4.6
                      Compensation                    5.8       10.1        5.5        3.8       -3.8      -11.2       -3.8
                      Output                          1.4        2.1        2.8        1.2       -5.4      -13.6        0.9

Sweden                ULC in nat. cur.                1.2        6.6       -2.2       -2.2        1.7       12.3      -13.9
                      Compensation                    4.5        8.4        3.4        2.7       -1.8       -7.9       -0.5
                      Output                          3.2        1.7        5.7        5.0       -3.5      -18.0       15.6

Taiwan                ULC in nat. cur.                0.5        5.5        0.2       -3.8       -5.9       -7.4      -10.7
                      Compensation                    7.1       13.5        5.2        3.1        0.6      -11.5       13.1
                      Output                          6.6        7.5        5.0        7.2        7.0       -4.4       26.7

United Kingdom        ULC in nat. cur.                3.1        6.3        1.4        0.8        2.7        7.5       -1.0
                      Compensation                    3.4        7.3        2.3        0.9       -0.9       -3.9        2.6
                      Output                          0.3        0.9        0.9        0.0       -3.5      -10.7        3.6

NOTE: German data for years before 1991 pertain to the former West Germany.
NA=data not available.






Table 3. Unit labor costs (ULC) in U.S. dollars and in national currency
         Manufacturing, 19 countries, 1979-2010
         Average annual compound rates of change

Country               Indicator                 1979-2010  1979-1990  1990-2000  2000-2007  2007-2010  2008-2009  2009-2010

United States         ULC in U.S. dollars             0.3        2.5       -0.4       -2.1        0.2       -0.5       -4.0
                      ULC in nat. cur.                0.3        2.5       -0.4       -2.1        0.2       -0.5       -4.0
                      Exchange rates                  --         --         --         --         --         --         --

Australia             ULC in U.S. dollars             NA         NA        -1.3        8.5        4.5       -5.1       13.3
                      ULC in nat. cur.                NA         NA         1.7        3.0        1.3        2.2       -2.4
                      Exchange rates                 -0.6       -3.2       -2.9        5.4        3.1       -7.1       16.1

Belgium               ULC in U.S. dollars             0.9        0.6       -2.5        6.7        0.2       -1.4       -7.9
                      ULC in nat. cur.                1.0        1.8        0.2        0.8        1.3        4.2       -3.2
                      Exchange rates                 -0.1       -1.2       -2.6        5.8       -1.1       -5.4       -4.8

Canada                ULC in U.S. dollars             2.4        4.6       -2.7        7.6        0.5       -8.8        6.1
                      ULC in nat. cur.                2.0        4.6       -0.3        2.7       -0.9       -2.4       -4.3
                      Exchange rates                  0.4        0.0       -2.4        4.8        1.4       -6.6       10.8

Czech Republic        ULC in U.S. dollars             NA         NA         NA         9.2        0.0       -8.6       -7.8
                      ULC in nat. cur.                NA         NA         NA        -0.2       -2.4        2.1       -7.6
                      Exchange rates                  NA         NA         NA         9.4        2.4      -10.5       -0.3

Denmark               ULC in U.S. dollars             2.3        4.1       -2.0        7.8       -1.9       -0.9      -10.7
                      ULC in nat. cur.                2.5        5.7        0.7        1.9       -0.8        4.3       -6.2
                      Exchange rates                 -0.2       -1.5       -2.6        5.8       -1.1       -5.0       -4.8

Finland               ULC in U.S. dollars             0.5        5.9       -7.1        2.6        2.9       12.8      -15.4
                      ULC in nat. cur.                1.0        5.7       -2.2       -3.1        4.0       19.2      -11.1
                      Exchange rates                 -0.5        0.2       -5.1        5.8       -1.1       -5.4       -4.8

France                ULC in U.S. dollars             1.6        3.4       -2.9        5.9        0.7       -0.6      -10.0
                      ULC in nat. cur.                2.1        5.7       -0.2        0.1        1.8        5.0       -5.4
                      Exchange rates                 -0.5       -2.2       -2.6        5.8       -1.1       -5.4       -4.8

Germany               ULC in U.S. dollars             1.9        4.5       -2.5        3.4        3.3       15.4      -14.7
                      ULC in nat. cur.                1.1        3.3        0.2       -2.3        4.4       21.9      -10.3
                      Exchange rates                  0.7        1.1       -2.7        5.8       -1.1       -5.4       -4.8

Italy                 ULC in U.S. dollars             2.8        5.2       -3.8        8.7        3.0        4.4       -9.2
                      ULC in nat. cur.                4.7        8.8        1.7        2.8        4.2       10.3       -4.6
                      Exchange rates                 -1.8       -3.3       -5.4        5.8       -1.1       -5.4       -4.8

Japan                 ULC in U.S. dollars             1.9        4.6        2.1       -5.0        8.4       22.6       -7.5
                      ULC in nat. cur.               -1.1        0.7       -0.9       -3.8       -1.7       11.1      -13.3
                      Exchange rates                  3.0        3.8        3.0       -1.3       10.3       10.4        6.7

Korea, Republic of    ULC in U.S. dollars             1.2        4.1       -2.0        4.5       -6.0      -10.3        9.5
                      ULC in nat. cur.                4.1        7.9        2.6        1.6        1.2        4.1       -0.7
                      Exchange rates                 -2.8       -3.4       -4.5        2.8       -7.0      -13.8       10.3

Netherlands           ULC in U.S. dollars             1.2        1.7       -2.4        5.7        0.8        2.6      -12.2
                      ULC in nat. cur.                0.5        0.8        0.3       -0.1        1.9        8.4       -7.7
                      Exchange rates                  0.6        0.9       -2.7        5.8       -1.1       -5.4       -4.8

Norway                ULC in U.S. dollars             3.7        4.9        0.0        8.1        1.8       -6.2        3.3
                      ULC in nat. cur.                4.3        6.9        3.5        2.0        2.8        4.7       -0.7
                      Exchange rates                 -0.6       -1.9       -3.4        6.0       -1.1      -10.4        4.1

Singapore             ULC in U.S. dollars             1.8        5.5       -1.0        0.8        0.2       -2.9      -12.8
                      ULC in nat. cur.                0.3        3.7       -1.5       -1.1       -3.1       -0.2      -18.3
                      Exchange rates                  1.5        1.7        0.5        2.0        3.4       -2.8        6.7

Spain                 ULC in U.S. dollars             2.3        3.8       -3.0        8.5        0.5       -2.7       -9.2
                      ULC in nat. cur.                4.3        7.8        2.7        2.5        1.6        2.9       -4.6
                      Exchange rates                 -2.0       -3.7       -5.5        5.8       -1.1       -5.4       -4.8

Sweden                ULC in U.S. dollars            -0.5        3.5       -6.4        2.2       -0.4       -3.4       -8.6
                      ULC in nat. cur.                1.2        6.6       -2.2       -2.2        1.7       12.3      -13.9
                      Exchange rates                 -1.7       -2.9       -4.3        4.5       -2.1      -14.0        6.2

Taiwan                ULC in U.S. dollars             0.9        8.3       -1.3       -4.5       -4.6      -11.6       -6.4
                      ULC in nat. cur.                0.5        5.5        0.2       -3.8       -5.9       -7.4      -10.7
                      Exchange rates                  0.4        2.7       -1.5       -0.7        1.4       -4.5        4.8

United Kingdom        ULC in U.S. dollars             2.1        4.7       -0.3        4.9       -5.8       -9.2       -2.3
                      ULC in nat. cur.                3.1        6.3        1.4        0.8        2.7        7.5       -1.0
                      Exchange rates                 -1.0       -1.6       -1.6        4.1       -8.3      -15.6       -1.3

NOTE: German data for years before 1991 pertain to the former West Germany.
NA=data not available.
Exchange rates are value of foreign currency relative to the U.S. dollar.





TECHNICAL NOTES 

The comparisons in this release are based on data available to the Bureau of
Labor Statistics as of September 1 from national statistical offices of the
19 countries compared. Below is a summary of the concepts used in this release.
For more detailed information, see www.bls.gov/ilc/#productivity. 

Definitions. Labor productivity is defined as real output per hour worked. Unit
labor costs are defined as the cost of labor input required to produce one unit
of output, and are computed as compensation in nominal terms divided by real output. 

Methodology. In general, the measures relate to total manufacturing as defined by
the International Standard Industrial Classification (ISIC). Data for the United
States and Canada are in accordance with the North American Industry Classification
System (NAICS), except for compensation data for the United States before 1987. For
most countries, the measures are prepared according to the United Nations System
of National Accounts 1993 (SNA 93) for the most recent years. For earlier years,
data were compiled according to other systems of national accounts. 

BLS constructs the trends in this release from three basic measures: output,
total labor hours, and total compensation. In general, the output measures are
real value added. Total labor hours refer to hours worked by all employed persons.
Total compensation includes employer expenditures for direct pay, employer social
insurance expenditures, and labor-related taxes and subsidies. 

Output for the United States. The U.S. manufacturing output series used in this
release differs from the manufacturing output series that BLS publishes as part
of its major sector productivity and costs measures for the United States.(1)  The 
international labor comparisons program uses a value added output concept, while
the major sector series is on a sectoral output basis, which is gross output less
intra-sector sales and transfers. Even though BLS has determined that sectoral
output is the correct concept for U.S. measures of productivity, there are other
considerations that make value added the better concept for international 
comparisons of labor productivity, such as differences among countries in the
extent of vertical integration of industries and the availability of value added data. 
	
Level Comparisons. The BLS measures are limited to trend comparisons. BLS does
not prepare level comparisons of manufacturing productivity because of data
limitations and technical problems in comparing the levels of manufacturing
output among countries.


1.  For more information about sectoral output, see www.bls.gov/lpc/.  


Last Modified Date: October 13, 2011

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