Workforce productivity increased last year in 39 states but declined in nine, including New Jersey, according to the U.S. Bureau of Labor Statistics.
Labor productivity measures the relationship between the amount of goods and services produced and the hours involved in producing it. It is largely driven by investment in capital, technological progress, and human capital development. The BLS said productivity declines in New Jersey and eight other states were due to a more rapid increase in hours worked, not a decline in output.
In New Jersey, private-sector employees’ hours worked increased 6.2% in 2021 while output increased 6.0%, according to the data released May 26 by the BLS.
Both hours worked and output increased in all 50 states in 2021. Nationally, workforce productivity increased 2.1%.
Washington and New Hampshire experienced the highest growth in labor productivity of 6.4% and 5.2%, respectively. Two states, Arkansas and Oklahoma, saw no change to labor productivity due to gains in output that matched gains in hours worked. Labor productivity declined in nine states: Alaska, Wyoming, Nevada, Hawaii, Rhode Island, Delaware, Florida, Georgia, and New Jersey.
The economic size of each state influences its contribution to national and regional estimates. California made the largest contribution to national growth in 2021. The state’s 4.2% growth in labor productivity last year contributed nearly one-third of the 2.1% growth of the nation.
