Unit labor costs in manufacturing decreased 6.9 percent from the same quarter a year ago, the largest four-quarter decline since the series began in the first quarter of 1988. This is according to data released by the U.S. Department of Labor's Bureau of Labor Statistics.
From the previous quarter, at an annual rate, unit labor costs in manufacturing fell 6.1 percent in the second quarter of 2010.
In the first quarter of 2010, unit labor costs in manufacturing declined 6.2 percent rather than falling 1.5 percent as previously reported—reflecting a 5.0-percentage point downward revision to hourly compensation.
The U.S. Bureau of Labor Statistics defines unit labor costs as the ratio of hourly compensation to labor productivity; increases in hourly compensation tend to increase unit labor costs and increases in output per hour tend to reduce them.
This data, from the Productivity and Costs program, is seasonally adjusted, and is subject to revision. To learn more about productivity, output, hours and related measures, see "Productivity and Costs: Second Quarter 2010, Preliminary" (HTML) (PDF), news release USDL-10-1101.
