Hawaii rises to the top in state-level labor productivity growth : New data from the BLS track output per hour worked in 2020

Join us on a road trip of FRED data in search of labor productivity.

The FRED Blog recently compared the increase in labor productivity during the COVID-19-induced recession with labor productivity in past recessions. Today, we use a recently added data set on state-level productivity from the U.S. Bureau of Labor Statistics to compare labor productivity across states.

First, labor productivity is output per hour worked. So, when labor productivity increases, an hour of work yields more output, which means more goods produced or more services delivered with the same amount of effort.

The GeoFRED map above shows the percent growth in labor productivity in Hawaii during 2020. The residents of the very last state to join the Union (August 21, 1959) recorded the fastest growth in labor productivity last year: 8.5%.

How did the other states fare? The second GeoFRED map shows Nevadans were not far behind Hawaii residents, as productivity in the Silver State grew 8%. But the blue coloring in the map shows states where productivity growth was negative during 2020. In descending order, an hour of work yielded fewer goods and services than during the previous year for Montanans, Oklahomans, Tennesseans, South Dakotans, and Idahoans.

The regional differences in labor productivity growth likely reflect idiosyncratic state economies. For example, goods manufacturing plays a much larger role in Oklahoma than in Hawaii. In that light, the uneven impact of the COVID-19-induced recession on the nationwide consumption and production of goods and services would have different impacts on state-level output, hours worked, and—ultimately—labor productivity.

How these maps were created: From GeoFRED, click on “Build new map” (green button, northeast corner of the screen) and then click on “Tools” (orange cogwheel button, northwest corner). Under “Region” select “State,” under “Data” select “Labor Productivity for Private Nonfarm,” and under “Date” select 2020. Zoom and move around the map to find the desired view. You can also edit the colors, legend, and labels.

Suggested by Diego Mendez-Carbajo.

Categories: Research