• Output per hour growth revised up on a smaller fall in output than initially estimated.

• The rise in unit labor costs revised down on stronger productivity and slightly weaker compensation growth.

In the second quarter of 2020, nonfarm business sector productivity increased 10.1% q/q SAAR--a 2.8%-point upward revision from the preliminary estimate of 7.3%. This was due mainly to a 1.8%-point upward revision to output. Unit labor costs increased 9.0% q/q, a smaller increase than previously reported (12.2%). This downward revision was largely due to the upward revision to productivity. Hourly compensation was revised down 0.4%-point, from a 20.4% increase to a 20.0% increase.

Manufacturing sector productivity for the second quarter of 2020 was revised up to a decrease of 14.6% q/q SAAR from a previously-reported decrease of 15.5%. Durable manufacturing productivity was also revised up, to a decline of 26.9%; nondurable manufacturing productivity was revised down slightly, to a decline of 5.1%. Total manufacturing unit labor costs increased 29.1% in the second quarter of 2020, rather than increasing 31.1% as previously reported.

The 10.1% q/q increase in nonfarm business sector labor productivity in Q2 was the largest quarterly increase since the first quarter of 1971, when output per hour increased 12.3%. The declines in both output and hours worked in the second quarter of 2020 were the largest in these series, which begins in 1947 Q1. The 20.0% increase in hourly compensation in Q2 was the largest increase in the series which also begins in 1947. Moreover, labor's share--the percentage of current-dollar output that accrues to workers in the form of compensation--increased to 59.8% in the second quarter, the highest level since 2008 Q4 (60.1%).

The productivity and labor cost figures are available in Haver's USECON database.