United States Leads World in Productivity
According to the U.S. Bureau of Labor Statistics, labor productivity in manufacturing increased by 6.2 percent in the United States in 1999, the latest year for which data is available. That increase was higher than nine other industrialized countries, including Japan, Germany and Canada. In fact, one country, Norway, showed no increase in productivity.
The U.S. Bureau of Labor Statistics defines productivity as manufacturing output per hour of labor. An increase in productivity represents a decrease in the amount of labor used to produce a unit of output. Thus, an increase in productivity can offset an increase in compensation per hour.
Unit labor costs in manufacturing declined in seven of the 13 countries for which such data is available. Unit labor costs decreased 1.1 percent in the United States. In comparison, unit labor costs decreased 4.3 percent in Korea, but they increased 6 percent in Denmark and 5.7 percent in Norway.
During the 20-year period from 1979 to 1999, manufacturing output increased in all the countries compared, from an average of 0.4 percent per year in Norway to 8.9 percent per year in Korea. During that same period, the total number of hours worked in manufacturing decreased.