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Productivity and Costs by Industry in 2008
added: 2010-09-02

Labor productivity - defined as output per hour - fell in wholesale trade, but rose in retail trade and in food services and drinking places, in 2009, the Bureau of Labor Statistics reported.

Productivity changes were as follows:

3.3 percent in wholesale trade,

1.5 percent in retail trade, and

1.0 percent in food services and drinking places.

In comparison, labor productivity fell in each of the three sectors overall in 2008. However, both output and hours declined more rapidly in each of the sectors in 2009 than they did in 2008.

Unit labor costs, which reflect the total labor costs required to produce a unit of output, declined in retail trade but rose in wholesale trade and food services and drinking places. By comparison, unit labor costs increased in each of the sectors in 2008.

Productivity rose in 2009 in nearly 60 percent of the 50 detailed industries studied. This was higher than the 36 percent of detailed industries that recorded productivity increases the previous year. In 2009, productivity growth in most industries resulted from declines in hours that more than offset changes in output. Output grew in only 10 of the detailed industries in 2009, while hours declined in 47. In comparison, output grew in 14 industries and hours declined in 30 in 2008. In 2009, only a single industry - farm product raw materials wholesalers - registered productivity growth as a result of increases in both output and hours. Unit labor costs declined in 46 percent of the detailed industries in 2009, compared to 32 percent in 2008.

Wholesale trade

Labor productivity fell 3.3 percent as output declined 10.1 percent and hours fell 7.1 percent. Output per hour rose in eight of the 19 detailed wholesale trade industries in 2009, compared with five in 2008. Productivity fell sharply in motor vehicles and parts wholesalers and in machinery and supplies wholesalers. Output grew in two industries, while hours declined in 18. Unit labor costs declined in six industries in 2009.

Retail trade

Labor productivity grew 1.5 percent while output and hours declined by 4.4 and 5.8 percent, respectively. Output per hour increased in 18 of the 27 detailed retail trade industries in 2009, compared with 12 in 2008. Output rose in eight industries while hours declined in 25 industries. Productivity increased most rapidly in florists, in other motor vehicle dealers, and in electronics and appliance stores, where hours fell sharply, as well as in specialty food stores where hours declined less rapidly. Unit labor costs fell in 16 industries.

Food services and drinking places

Labor productivity rose 1.0 percent as output fell 2.5 percent and hours declined by 3.5 percent. Output per hour increased in three of the four detailed food services and drinking places industries in 2009, an improvement over 2008, when productivity grew in only one industry. Output and hours fell in all the industries in 2009 and unit labor costs fell in one industry.

Over the longer term, 1987 - 2009, output per hour increased in wholesale trade, retail trade, and food services and drinking places at the following average annual rates:

2.6 percent in wholesale trade,

2.9 percent in retail trade, and

0.7 percent in food services and drinking places.

Output, hours, and unit labor costs also rose in all three sectors over the period. Between 1987 and 2009, productivity increased in 46 of the 50 detailed industries and unit labor costs fell in 17.

Year-to-year movements in industry productivity may be erratic, particularly in smaller industries. The annual measures based on sample data may differ from measures generated by a census of establishments in the industry. Annual changes in an industry’s output and use of labor may reflect cyclical changes in the economy as well as long-term trends. As a result, long-term productivity trends tend to be more reliable indicators of industry performance than year-to-year changes.


Source: U.S. Department of Labor

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