BLS publishes experimental state-level labor productivity measures

Source: Sabrina Wulff Pabilonia, Michael W. Jadoo, Bhavani Khandrika, Jennifer Price, James D. Mildenberger, U.S. Bureau of Labor Statistics, Monthly Labor Review, June 2019

The U.S. Bureau of Labor Statistics recently published experimental data on state-level labor productivity for the private nonfarm sector, including state-level output per hour, output, hours, unit labor costs, hourly compensation, and real hourly compensation data series. These annual data series, covering 2007−17, provide insights into the variation in productivity across states. Over this period, average annual productivity growth ranged from 3.1 percent in North Dakota to −0.7 percent in Louisiana. However, California, whose productivity grew at an average annual rate of 1.7 percent, was the largest contributor to national productivity growth due to the large size of its economy. This article describes the data and methodology used to estimate this new experimental state-level labor productivity series. In addition, it examines the compensation-productivity gap, the relationship between productivity growth and the share of output in the information and communications technology producing sector, and whether state-level labor productivity was converging in the postrecession period.