Productivity accelerates

Compensation

Productivity (Y / Y in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		1.4 %	1.4 %	0.8 %	1.5 %	1.3 %	1 %
Nonfarm business		1.3 %	1.3 %	1.1 %	1.5 %	1.3 %	1.1 %
Manufacturing		-0.2 %	0.8 %	1.1 %	0.3 %	1.1 %	0.3 %
Durable Goods		0.2 %	1.5 %	1.4 %	0.3 %	1.3 %	0.8 %
Nondurable Goods		-0.6 %	-0.1 %	0.5 %	0.2 %	0.8 %	-0.4 %

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.

Productivity (Q / Q in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		3.6 %	1.1 %	-0.9 %	3.6 %	1.3 %	-1.5 %
Nonfarm business		2.9 %	0.7 %	-0.1 %	3 %	1.5 %	-0.6 %
Manufacturing		0.9 %	0.5 %	5.7 %	-4.4 %	2.9 %	0.4 %
Durable Goods		0.9 %	1.3 %	6.7 %	-4.7 %	3.8 %	-1.1 %
Nondurable Goods		1.1 %	0.6 %	4.5 %	-4.4 %	0.5 %	3.2 %

Output (Y / Y in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		3.4 %	3.5 %	3 %	2.8 %	2.6 %	2.3 %
Nonfarm business		3.5 %	3.6 %	3.2 %	3 %	2.8 %	2.4 %
Manufacturing		1.8 %	2.5 %	2.7 %	1.5 %	1.6 %	0.9 %
Durable Goods		2.4 %	5.5 %	8.2 %	-1.7 %	1 %	1.5 %
Nondurable Goods		1.3 %	2.3 %	2.6 %	1.6 %	1.5 %	0.3 %

Output (Q / Q in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		5 %	2.8 %	3.1 %	4.1 %	3.7 %	0.5 %
Nonfarm business		4.8 %	2.8 %	3.2 %	4.1 %	4 %	1 %
Manufacturing		1.9 %	3.3 %	7.3 %	-1.1 %	2.1 %	2.8 %
Durable Goods		2.4 %	5.5 %	8.2 %	-1.7 %	1 %	2.8 %
Nondurable Goods		1.5 %	1.1 %	6.4 %	-0.4 %	3.4 %	2.8 %

Unit Labor Costs (Y / Y in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		1.9 %	1.2 %	1.5 %	-0.5 %	- %	2.9 %
Nonfarm business		1.9 %	1.1 %	1.3 %	-0.7 %	-0.2 %	2.8 %
Manufacturing		2.7 %	1.3 %	1.1 %	0.3 %	0.1 %	4.3 %
Durable Goods		2.7 %	1.4 %	1.3 %	0.6 %	-0.4 %	4 %
Nondurable Goods		2.4 %	0.9 %	0.8 %	-0.1 %	1.1 %	4.6 %

Unit Labor Costs The measures of unit labor costs describe the relationship between compensation per hour and productivity, or real output per hour, and can be used as an indicator of inflationary pressure on producers. Increases in hourly compensation increase unit labor costs; labor productivity increases offset compensation increases and lower unit labor costs.

Unit Labor Costs (Q / Q in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		-1.1 %	2.8 %	2 %	-0.3 %	0.5 %	3.4 %
Nonfarm business		-0.9 %	2.7 %	2 %	-0.2 %	0.2 %	3 %
Manufacturing		0.6 %	2.7 %	-3.7 %	4.8 %	-0.4 %	2.1 %
Durable Goods		0.4 %	2.9 %	-3.8 %	5 %	-0.6 %	2.5 %
Nondurable Goods		0.8 %	0.4 %	-4 %	5.1 %	1 %	1.3 %

Hours Worked (Y / Y in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		2 %	2.1 %	2.3 %	1.3 %	1.3 %	1.2 %
Nonfarm business		2.2 %	2.2 %	2.1 %	1.5 %	1.5 %	1.3 %
Manufacturing		2.1 %	1.6 %	1.6 %	1.2 %	0.5 %	0.7 %
Durable Goods		2.1 %	1.2 %	1.3 %	1 %	0.3 %	0.7 %
Nondurable Goods		2 %	2.4 %	2.1 %	1.4 %	0.8 %	0.7 %

Hours Worked Hours data for the labor productivity and cost measures include hours for all persons working in the sector—wage and salary workers, the self-employed and unpaid family workers.

Hours Worked (Q / Q in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		1.3 %	1.6 %	4.1 %	0.5 %	2.4 %	2.1 %
Nonfarm business		1.9 %	2.1 %	3.3 %	1.1 %	2.5 %	1.6 %
Manufacturing		1 %	2.8 %	1.5 %	3.5 %	-0.7 %	2.4 %
Durable Goods		1.4 %	4.2 %	1.4 %	3.1 %	-2.7 %	4 %
Nondurable Goods		0.4 %	0.5 %	1.8 %	4.1 %	2.8 %	-0.4 %

Real Hourly Compensation (Y / Y in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		0.8 %	0.4 %	-2.5 %	1.3 %	2.1 %	-1.3 %
Nonfarm business		0.5 %	0.2 %	0.3 %	-1.1 %	-0.8 %	1.3 %
Manufacturing		-0.2 %	-0.1 %	- %	-1.3 %	-0.6 %	2 %
Durable Goods		0.2 %	0.7 %	0.5 %	-1 %	-1 %	2.2 %
Nondurable Goods		-0.9 %	-1.5 %	-0.8 %	-1.8 %	- %	1.6 %

Real Hourly Compensation (Q / Q in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		0.8 %	0.4 %	-2.5 %	1.3 %	2.1 %	-1.3 %
Nonfarm business		0.3 %	-0.1 %	-1.8 %	0.7 %	2.1 %	-0.8 %
Manufacturing		-0.1 %	-0.3 %	-1.8 %	-1.8 %	2.8 %	-0.6 %
Durable Goods		-0.3 %	0.7 %	-1 %	-1.9 %	3.5 %	-1.7 %
Nondurable Goods		0.2 %	-2.4 %	-3.3 %	-1.5 %	1.9 %	1.4 %

Hourly Compensation (Y / Y in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		1.5 %	3.2 %	1.8 %	0.2 %	2.5 %	2.5 %
Nonfarm business		2.4 %	3.9 %	1.1 %	3.3 %	1.8 %	1.8 %
Manufacturing		1.3 %	4.2 %	2.6 %	0.1 %	3.1 %	1.4 %
Durable Goods		1.9 %	1 %	0.3 %	0.5 %	1.6 %	4.6 %
Nondurable Goods		1.7 %	0.7 %	1.3 %	0.1 %	1.9 %	- %

Hourly Compensation The measure includes accrued wages and salaries, supplements, employer contributions to employee benefit plans, and taxes.

Hourly Compensation (Q / Q in %)		II Quarter 2018 prel.	I Quarter 2018 prel.	IV Quarter 2017 prel.	III Quarter 2017 prel.	II Quarter 2017 prel.	I Quarter 2017 prel.
Total Business		2.4 %	3.9 %	1.1 %	3.3 %	1.8 %	1.8 %
Nonfarm business		2 %	3.4 %	1.8 %	2.7 %	1.8 %	2.4 %
Manufacturing		1.5 %	3.2 %	1.8 %	0.2 %	2.5 %	2.5 %
Durable Goods		1.3 %	4.2 %	2.6 %	0.1 %	3.1 %	1.4 %
Nondurable Goods		1.9 %	1 %	0.3 %	0.5 %	1.6 %	4.6 %