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Labor Productivity Increases in Mining Industry

Labor productivity – defined as output per hour – rose in 69 percent of the 52 service-providing and mining industries studied in 2010, the U.S. Bureau of Labor Statistics reported. This was up from 42 percent in 2009. Unit labor costs, which reflect the total labor costs required to produce a unit of output, declined in 46 percent of the industries in 2010, compared to 35 percent in 2009.

Productivity increased in more industries in 2010 than in any year since 2003, while output rose in more industries than in any year since 2007. The number of industries with increases in output and the number of industries with increases in hours both rose in 2010 after declining in 2007, 2008, and 2009. However, declining hours continued to contribute to productivity gains for many industries. Of the industries with productivity increases in 2010, 72 percent registered output increases, while 86 percent posted declines in labor hours. Unit labor costs fell in 23 of 47 service-providing industries, the most since 2003, but in only one of the five mining industries in 2010. Industry labor productivity measures are updated as data become available.

Mining industries output per hour rose in four of the five detailed mining industries studied; only coal mining posted a productivity decline. Productivity was particularly strong in the support activities for mining industry, where strong growth in output exceeded a large increase in labor hours.

However, because support activities for mining are completely consumed by other mining industries, they are not included in the final output leaving the sector. After excluding support activities for mining, overall productivity for the mining sector declined slightly, as output grew more slowly than hours.

Industry productivity performance over the long term contrasts with the performance in 2010. Between 1987 and 2010, labor productivity increased in 87 percent of the detailed service-providing and mining industries, with more than 70 percent of industries recording average productivity growth between 0.1 and 4.0 percent per year. In 2010, large productivity gains were more common than over the longer term; 35 percent of industries posted productivity gains of 6.1 percent or more, the most since 1998.