According to the National Association of Manufacturers’ (NAM) Monday Economic Report for this week, manufacturing employment edged down by 2,000 in May, declining for the second time in the past three months. The sector has added just 10,000 workers YTD, slowing considerably after adding 385,000 and 390,000 employees in 2021 and 2022, respectively.  
 
Manufacturing labor productivity fell 2.5% at the annual rate in Q1 2023, declining for the sixth time in the past seven quarters. Output in the sector declined 1.0% in Q1, extending the 3.7% decrease in Q4. The number of hours worked, however, rose 1.6% in Q1, with hourly compensation inching up 0.5%. Unit labor costs among manufacturers increased 3.1%, rising for the eighth straight quarter.  
 
Labor productivity for durable goods decreased 5.6% in Q1, building on the 3.7% and 2.2% declines in Q3 and Q4, respectively. Output dropped 3.2%, but the number of hours worked rose 2.5%. Hourly compensation pulled back 1.2%, and unit labor costs for durable goods jumped 4.7% in Q1. In contrast, labor productivity for nondurable goods rose 1.3% in Q1 after decreasing 0.2% and 4.3% in Q3 and Q4, respectively. Output and hourly compensation increased 1.4% and 3.6%, respectively, with the number of hours worked flat. Unit labor costs for nondurable goods firms increased 2.2%.