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Multifactor productivity decreased 0.2 percent in 2016
April 07, 2017
Multifactor productivity in the private nonfarm business sector decreased at a 0.2-percent annual rate in 2016. This was the first decline in multifactor productivity since 2009. The 2016 decline reflected a 1.7-percent increase in output and a 1.9-percent increase in the combined inputs of capital and labor. Capital services grew by 2.4 percent and labor input—the combined effect of hours worked and labor composition—grew by 1.6 percent.
Annual percent change in multifactor productivity and related measures, 1988–2016
Year
Multifactor productivity
Real value-added output
Combined inputs
Capital services
Labor input
1988
1.2%
4.6%
3.4%
3.8%
3.2%
1989
0.2
3.7
3.4
3.9
3.2
1990
0.5
1.5
1.0
3.4
-0.2
1991
-0.4
-0.5
-0.1
2.9
-1.5
1992
3.1
4.0
0.9
2.5
0.1
1993
-0.4
3.2
3.6
3.2
3.7
1994
0.5
4.6
4.1
3.6
4.3
1995
-0.2
3.6
3.8
4.4
3.5
1996
1.5
4.6
3.0
4.8
2.1
1997
0.9
5.2
4.3
5.5
3.7
1998
1.4
5.3
3.9
6.2
2.8
1999
1.7
5.6
3.8
6.5
2.6
2000
1.6
4.4
2.8
6.4
1.1
2001
0.5
0.9
0.3
4.7
-1.6
2002
2.2
1.8
-0.4
3.2
-2.0
2003
2.3
3.2
0.8
2.6
-0.1
2004
2.6
4.5
1.9
2.5
1.6
2005
1.5
3.8
2.3
3.1
1.8
2006
0.4
3.3
2.9
3.5
2.6
2007
0.5
2.4
1.9
3.1
1.2
2008
-1.3
-1.3
0.0
2.6
-1.4
2009
-0.4
-4.1
-3.7
0.8
-6.2
2010
2.9
3.2
0.3
0.4
0.3
2011
0.3
2.2
1.9
1.0
2.4
2012
0.9
3.1
2.3
1.4
2.8
2013
0.2
2.1
1.8
1.9
1.8
2014
0.7
3.1
2.4
2.2
2.5
2015
0.6
3.2
2.5
2.5
2.6
2016
-0.2
1.7
1.9
2.4
1.6
Multifactor productivity in the private nonfarm business sector grew at an average annual rate of 0.9 percent from 1987 to 2016. For the 2007–16 period, it grew 0.4 percent on average, as combined inputs increased at an average annual rate of 1.0 percent and output increased at a 1.4-percent average annual rate. The increase in combined inputs reflected a 1.7-percent average annual increase in capital services and a 0.7-percent average annual increase in labor input.
These data are from the Multifactor Productivity program. To learn more, see "Multifactor Productivity Trends — 2016" (HTML) (PDF). Multifactor productivity is calculated by dividing an index of real output by an index of combined units of labor input and capital services. Unlike BLS quarterly labor productivity (output per hour worked) measures, multifactor productivity measures include the influences of capital services and shifts in the composition of the workforce.
United States Department of Labor
