Transportation Economic Trends

  Transportation Productivity: 

Transportation Economic Concepts

This page highlights transportation economic concepts related to transportation productivity.

What is Productivity?

Productivity measures the rate at which workers produce goods or complete work. Economic productivity has a more precise definition: it estimates the ratio of total output to the inputs used in the production process. Inputs may include capital, labor, energy, materials, and services (also known as KLEMS). Productivity increases when a business produces the same output more efficiently by using fewer (or lower-cost) inputs or produces more output with the same (or fewer) inputs, e.g., new technology helps workers produce more goods in the same amount of time. The reverse is also true. Productivity decreases when a business produces the same output using more (or higher cost) inputs or produces less output with the same (or more) inputs.
The two main measures of transportation productivity include: labor productivity and multifactor productivity (MFP). Labor productivity measures the output per unit of labor input, while multifactor productivity measures the output per unit as a weighted average of multiple factors, including capital, labor, and intermediate inputs (e.g., fuel, equipment, and materials).

What is Productivity? Consumer and Producer Price Indexes

Data Sources for Transportation Productivity

The Bureau of Labor Statistics (BLS) produces productivity statistics through its Major Sector Productivity (MSP) Program and its Industry Productivity Studies (IPS). The productivity statistics differ due to methodological differences between the programs. The labor and multifactor productivity statistics presented come from the MSP program because the MSP program produces statistics for all transportation sectors, whereas the ISP program produces statistics for only a few transportation industries.

Major Sector Productivity Program

  • Produces productivity measures at the North American Industry Classification (NAICS) sector (2-digit) and subsector (3-digit) level.
  • Takes an aggregate approach and uses real gross output (less the portion consumed in the same industry) obtained from the Bureau of Economic Analysis

Industry Productivity Studies (IPS)

  • Publishes productivity statistics at the 4-digit NAICS industry level. 
  • Takes a micro-level approach and uses deflated sales, values, or physical quantities for output. 
Sometimes a 3-digit subsector is the same as a 4-digit industry in the NAICS system and, as a result, both MSP and IPS produce measures for the same NAICS industry.
BLS also collaborates with the Bureau of Economic Analysis (BEA). BEA produces industry-level production accounts, including a productivity measure, for the United States. To produce the accounts, BEA and BLS combine data on industry-level outputs and intermediate inputs from BEA’s GDP by industry accounts with data on capital inputs and labor hours from the BLS Productivity Programs. The integrated accounts show the contribution of labor, capital, multifactor productivity to economic growth. For more information, please see “A Prototype BEA/BLS Industry‐Level Production Account for the United States,” available at https://www.bls.gov/mfp/bea_bls_industry_product_account.pdf.


Recommended citation
U.S. Department of Transportation, Bureau of Transportation Statistics, Transportation Economic Trends, available at www.bts.gov/product/transportation-economic-trends.

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The Bureau of Transportation Statistics, part of the U.S. Department of Transportation, is the preeminent source of statistics on commercial aviation, multimodal freight activity, and transportation economics, and provides context to decision makers and the public for understanding statistics on transportation.
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