Transportation Economic Trends
Productivity measures answer important questions about the performance of the transportation sector. This page discusses multifactor productivity. Data and discussion about labor productivity also available.
- Among the sectors experiencing gains in multifactor productivity in 2018, transportation and warehousing grew the least at 0.1 percent.
- Pipeline experienced the greatest increase in multifactor productivity in 2018, growing 4.8 percent. Warehousing and truck transportation experienced a decline in multifactor productivity over the same period.
Multifactor productivity (MFP) measures output per unit as a weighted average of multiple factors, including capital, labor, and intermediate inputs (e.g., fuel and materials). Unlike labor productivity, which is a single-factor measure of productivity, changes in MFP reflect the combined effect of multiple inputs. MFP better captures the effect of new technologies, regulatory and organizational changes than labor productivity.
MFP are available for all sectors, enabling comparisons across sectors. Transportation and warehousing shows higher MFP than most other sectors.
Gains in transportation and warehousing MFP can result from increases in output per unit of one or the weighted inputs over time. Inputs include:
- Capital: cumulative value of the services rendered from the use of physical assets such as equipment, structures, and software over time
- Labor: combined effect of hours worked and the effort and skills of the workers
- Intermediates: fuels, materials (e.g., tires), and purchased services
Multifactor Productivity by Transportation Mode
Transportation modes and warehousing experience different MFP - unique to the inputs, new technologies, and regulations each faces.