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Technical USDL 03-972
information: (202) 691-5618 FOR RELEASE: 10:00 a.m. EST
Media contact: (202) 691-5902 Tuesday, December 30, 2003
Internet: http://www.bls.gov/lpc/home.htm
PRODUCTIVITY AND COSTS: WHOLESALE TRADE, RETAIL TRADE, AND
FOOD SERVICES AND DRINKING PLACES, 2002
The Bureau of Labor Statistics of the U.S. Department of Labor reported today on
labor productivity and unit labor cost changes for wholesale trade, retail trade, and food
services and drinking places. For 2002, labor productivity--defined as output per
hour--rose 5.8 percent for all of wholesale trade, 4.2 percent for retail trade, and 1.3
percent for food services and drinking places. In both the retail and wholesale trade
sectors, output increased in 2002 while hours and unit labor costs declined. In food
services and drinking places, output, hours, and unit labor costs all increased in 2002.
Over the whole period for which data are presented, 1987 to 2002, labor
productivity in the wholesale trade sector rose an average of 3.5 percent per year. Output
increased 4.1 percent per year, hours increased 0.6 per year, and unit labor costs
increased 0.7 percent per year. Labor productivity in retail trade increased 2.8 percent
per year, while output increased 3.8 percent, hours increased 1.0 percent, and unit labor
costs increased 0.5 percent per year. In the food services and drinking places subsector,
annual average labor productivity increased 0.6 percent, in 1987-2002, as output
increased at a rate of 2.3 percent, hours grew 1.6 percent, and unit labor costs increased
3.2 percent per year.
2001-02 change
Labor productivity grew in 14 of the 18 durable and nondurable wholesale trade
industries measured in 2002. Six of the nine durable goods wholesale industries had
productivity increases, and eight of the nine nondurable goods wholesalers had
productivity increases. Among the durable goods wholesale industries, the highest
productivity increases occurred for commercial equipment (NAICS 4234) and lumber
and construction supplies (NAICS 4233), with output per hour increases of 15.7 percent
and 9.7 percent, respectively. Druggists� goods (NAICS 4242) had the highest
productivity increase among the nondurable industries (13.9 percent) followed by farm
product raw materials (NAICS 4245) with an increase of 12.7 percent. Output increased
in five of the nine durable goods and seven of the nine nondurable goods wholesalers in
2002. Hours declined in all of the durable goods wholesalers and six of the nondurable
goods wholesalers. Unit labor costs declined in 13 of the 18 industries. Labor
productivity increased 2.7 percent for wholesale electronic markets and agents and
brokers (NAICS 425), reflecting a 2.7 percent increase in output and no change in hours
in 2002.
Labor productivity rose in 23 of the 27 retail trade industries in 2002. The highest
increases were 19.6 percent in electronics and appliance stores (NAICS 443) and 17.9
percent in electronic shopping and mail-order houses (NAICS 4541). Productivity grew
in four of the six largest retail trade industries, those with more than 1,000,000
employees. Productivity increased 10.9 percent in other general merchandise stores
(NAICS 4529), 6.2 percent in clothing stores (NAICS 4481), 3.9 percent in building
material and supplies dealers (NAICS 4441), and 3.1 percent in grocery stores (NAICS 4451).
Labor productivity declined 1.0 percent for department stores (NAICS 4521) and 2.6 percent
for automobile dealers (NAICS 4411). Productivity declined in only two other retail trade
industries--0.5 percent for jewelry, luggage, and leather goods stores (NAICS 4483) and
1.3 percent for other miscellaneous store retailers (NAICS 4539). Output grew in 22 of
the 27 retail industries, and all but one of these industries experienced productivity
increases. Hours declined in 15 retail industries, 14 of which experienced productivity
increases.
Unit labor costs decreased in 20 of the 23 retail industries that had labor
productivity increases in 2002. The largest declines were 19.5 percent in electronics and
appliance stores and 15.3 percent in electronic shopping and mail-order houses. Unit
labor costs declined in the three of the four largest retail industries that had
productivity increases--3.8 percent in other general merchandise stores, 4.4 percent in
building materials and supply dealers, and 1.6 percent in clothing stores. All of the
industries with productivity declines also had unit labor cost increases.
Labor productivity increased 1.3 percent in food services and drinking places in
2002. All four of the industries had productivity gains. The largest productivity gains
occurred for drinking places (NAICS 7224) -- 8.0 percent. The two large industries in
this group, full-service eating places (NAICS 7221) and limited-service eating places
(NAICS 7222), experienced productivity gains of 1.3 percent and 0.7 percent,
respectively. Unit labor costs increased in the three food services industries in 2002,
while drinking places had a decline in unit labor costs of 4.6 percent.
Long-term trends
Labor productivity increased in 14 of the 18 durable and nondurable industries in
the wholesale trade sector from 1987 to 2002. Productivity in two of these industries
increased 5.0 percent per year or more. Productivity in an additional three industries
increased between 2.5 and 4.9 percent per year. Average annual output rose in all but
two wholesale durable and nondurable industries, petroleum (NAICS 4247) and
miscellaneous nondurable goods (NAICS 4249). Hours declined in only three industries,
while average annual unit labor costs declined in only commercial equipment (NAICS 4234)
and electric goods (NAICS 4236). Productivity rose 5.1 percent per year in wholesale
electronic markets and agents and brokers (NAICS 425), during 1987-2002, reflecting
average gains in output, hours, and unit labor costs of 6.3 percent, 1.2 percent, and
0.1 percent, respectively.
Output per hour increased in 25 of the 27 retail trade industries from 1987 to
2002. Labor productivity advanced 5.0 percent per year or more in 4 of the retail
industries, and output per hour increased in the 2.5-4.9 percent range for 14 retail
industries. Average annual output increased in 25 of the 27 retail industries, while hours
increased in 21 industries. Average annual unit labor costs declined in 12 of the 27 retail
trade industries. Among the six largest retail industries, other general merchandise
stores had 1987 to 2002 average productivity gains of 8.3 percent per year, while average
annual output per hour increased 4.8 percent in clothing stores.
All three of the food services industries had long-term labor productivity rates of
0.8 percent or less. Labor productivity in drinking places declined 1.5 percent per year,
1987-2002, as output declined 0.5 percent per year while hours increased 1.1 percent. All
food services and drinking places industries had unit labor costs increases between 1987
and 2002.
********************************************************************************
* Labor productivity and associated series through 2001 for all 3-digit NAICS *
* manufacturing industries are available on the Labor Productivity and Costs *
* web site (http://www.bls.gov/lpc/home.htm). Additional selected 5-digit *
* and 6-digit NAICS manufacturing industries are available by request. *
********************************************************************************
Technical note
The data in this news release replace the wholesale trade, retail trade, and food
services and drinking places series published in the news release Productivity and Costs
by Industry, 2001 (released Sept. 18, 2003). Data for 2002 should be considered
preliminary. Due to periodic revision of source data, all measures are subject to revision.
Data in this news release are based on the North American Industry Classification
System (NAICS). The NAICS differs from the Standard Industry Classification (SIC) it
replaced in that it uses a production-oriented approach to categorize economic units and
has a greater emphasis on emerging industries and service-producing industries. In
contrast to the SIC system, NAICS classifies auxiliary units involved in activities such as
transportation and warehousing; accounting, bookkeeping, and payroll services; and
general management into specialized industries rather than including them in the
manufacturing, trade, or service industries they support.
Industry output indexes are prepared from basic data published by various public
and private agencies, using the greatest level of detail available. Data from the Bureau of
the Census, U.S. Department of Commerce, are used extensively in developing the output
series. The Census of Retail Trade, the Census of Wholesale Trade, and the Census of
Accommodation and Food Services provide detailed product data for the industries in this
report. The Census Bureau also publishes annual industry sales data for the years 1992
forward on the North American Industry Classification System. Data prior to 1992 were
classified according to the Standard Industrial Classification (SIC) system. Conversion
ratios based on 1997 Census data were used to convert these sales data from SIC to
NAICS. The labor series used in the industry productivity measures are based primarily
on employment and average weekly hours data from the Bureau of Labor Statistics�
Current Employment Statistics (CES) survey and the Current Population Survey (CPS).
Productivity measurement
The industry labor productivity measures describe the relationship between output
and the labor time involved in its production. They show the changes from period to
period in the amount of goods and services produced per hour. Although these measures
relate output to hours of employees or all persons engaged in an industry, they do not
measure the specific contribution of labor, capital, or any other factor of production.
Rather, they reflect the joint effects of many influences, including changes in technology;
capital investment; level of output; utilization of capacity, energy, and materials; the
organization of production; managerial skill; and the characteristics and effort of the
workforce.
The indexes of industry output used in measuring labor productivity and unit
labor costs are, wherever possible, calculated with a Tornqvist formula. This formula
aggregates the growth rates of the various industry products between two periods using
the products� shares in industry value of production, averaged over the two periods, as
weights.
Year-to-year movements in productivity measures for some industries might be
erratic, particularly in the smaller industries. The annual changes in an industry�s output
and use of labor may reflect cyclical changes in the economy rather than long-term
trends. Also, annual productivity indexes are based on sample data, which are likely
to differ from data generated by a census of establishments in the industry. As a result,
long-term trends tend to be more reliable indicators of the performance of an industry
than are the year-to-year changes.
Unit labor cost measurement
The unit labor cost series in this release describe the cost of labor input required
to produce one unit of output. Unit labor costs are calculated as the ratio of current dollar
labor compensation to constant dollar output. The indexes of unit labor costs for each
industry are computed by dividing an index of current dollar compensation by an index of
constant dollar output.
Compensation is a measure of the cost to the employer of securing the services of
labor. It is defined as payroll plus supplemental payments. Payroll includes salaries,
wages, commissions, dismissal pay, bonuses, vacation and sick leave pay, and
compensation in kind. Supplemental payments are divided into legally required
expenditures and payments for voluntary programs. The legally required expenditures
include employers� contributions to Social Security, unemployment insurance taxes, and
workers� compensation. Payments for voluntary programs include all programs not
specifically required by legislation, such as the employer portion of private health
insurance and pension plans.
Productivity and unit labor cost data for the NAICS industries in this news
release can be obtained in several ways: by visiting the Labor Productivity and Costs web
site (http://www.bls.gov/lpc/home.htm); by calling the Division of Industry Productivity
Studies (202-691-5618); or by sending a request by e-mail (dipsweb@bls.gov).
Historical productivity and related series for 3- and 4-digit SIC industries through 2000
will continue to be maintained, but will no longer be updated. SIC-based industry data
are available on the BLS web site or by request.
Table 1. Annual percent change in output per hour and related series: retail trade, wholesale trade, and food services
and drinking places industries, 1987-02 and 2001-02
Annual percent change, 1987-02 Annual percent change, 2001-02
NAICS Industry
code 2002
Employment Output Output
Wholesale Trade (thousands) per hour Output Hours per hour Output Hours
42 Wholesale trade 5842 3.5 4.1 0.6 5.8 2.2 -3.3
423 Durable goods 3096 5.0 5.4 0.4 6.2 0.6 -5.3
4231 Motor vehicles and parts 360 3.4 3.6 0.2 6.7 5.1 -1.5
4232 Furniture and furnishings 116 1.8 2.3 0.5 -1.5 -3.5 -2.0
4233 Lumber and construction supplies 229 0.0 1.3 1.4 9.7 9.3 -0.4
4234 Commercial equipment 673 13.6 14.3 0.6 15.7 6.6 -7.9
4235 Metals and minerals 128 -0.3 0.1 0.4 -1.4 -5.9 -4.6
4236 Electric goods 374 9.7 9.9 0.1 8.4 -1.5 -9.1
4237 Hardware and plumbing 244 1.8 2.8 1.0 5.2 1.0 -4.0
4238 Machinery and supplies 696 2.2 2.1 -0.2 -2.8 -8.2 -5.5
4239 Miscellaneous durable goods 276 2.2 3.1 0.9 7.9 3.1 -4.5
424 Nondurable goods 2111 1.2 1.8 0.6 5.3 4.0 -1.3
4241 Paper and paper products 164 2.0 2.3 0.3 9.4 1.2 -7.5
4242 Druggists' goods 215 3.3 6.7 3.3 13.9 14.8 0.8
4243 Apparel and piece goods 158 1.6 1.7 0.1 8.9 4.9 -3.7
4244 Grocery and related products 711 1.6 2.8 1.1 2.7 4.6 1.8
4245 Farm product raw materials 79 3.4 0.2 -3.0 12.7 2.3 -9.2
4246 Chemicals 135 -0.2 1.1 1.3 2.9 1.6 -1.2
4247 Petroleum 113 1.8 -0.6 -2.4 7.4 -0.4 -7.2
4248 Alcoholic beverages 134 1.1 2.0 0.9 5.2 6.6 1.3
4249 Miscellaneous nondurable goods 402 -0.8 -0.3 0.5 -6.8 -8.4 -1.8
425 Electronic markets and agents and brokers 636 5.1 6.3 1.2 2.7 2.7 0.0
42511 Business to business electronic markets 85 7.8 8.2 0.4 17.7 7.9 -8.4
42512 Wholesale trade agents and brokers 550 3.9 5.2 1.3 -2.0 -0.7 1.4
Retail Trade
44, 45 Retail trade 15942 2.8 3.8 1.0 4.2 3.3 -0.9
441 Motor vehicle and parts dealers 1950 1.7 3.0 1.3 -0.2 -0.6 -0.4
4411 Automobile dealers 1304 1.3 2.8 1.4 -2.6 -1.1 1.6
4412 Other motor vehicle dealers 145 3.2 5.2 1.9 3.3 5.8 2.4
4413 Auto parts, accessories, and tire stores 501 2.6 3.4 0.8 5.8 -0.2 -5.6
442 Furniture and home furnishings stores 602 3.3 4.5 1.1 5.3 5.4 0.0
4421 Furniture stores 313 3.6 4.3 0.7 6.0 6.0 0.0
4422 Home furnishings stores 289 3.0 4.6 1.5 4.4 4.5 0.1
443 Electronics and appliance stores 566 12.9 15.2 2.0 19.6 15.3 -3.6
444 Building material and garden supply stores 1206 2.9 4.9 1.9 3.5 5.7 2.2
4441 Building material and supplies dealers 1044 2.8 5.1 2.2 3.9 6.5 2.5
4442 Lawn and garden equipment and supplies store 162 3.3 3.4 0.1 0.9 0.8 -0.1
445 Food and beverage stores 3014 0.1 0.5 0.4 2.8 0.5 -2.3
4451 Grocery stores 2551 0.0 0.6 0.5 3.1 0.3 -2.6
4452 Specialty food stores 303 -0.6 -0.5 0.1 3.8 2.7 -1.0
4453 Beer, wine and liquor stores 160 1.0 0.3 -0.7 0.7 1.0 0.3
446 Health and personal care stores 954 2.2 3.8 1.6 4.6 4.6 0.0
447 Gasoline stations 924 2.2 1.7 -0.5 5.9 2.3 -3.4
448 Clothing and clothing accessories stores 1389 4.5 4.6 0.0 4.8 5.5 0.7
4481 Clothing stores 1003 4.8 5.0 0.2 6.2 6.4 0.1
4482 Shoe stores 185 3.9 2.5 -1.4 4.0 0.3 -3.6
4483 Jewelry, luggage, and leather goods stores 201 3.8 4.5 0.7 -0.5 6.0 6.6
451 Sporting goods, hobby, book, and music store 732 4.1 5.6 1.5 6.1 4.6 -1.4
4511 Sporting goods and musical instrument stores 492 4.6 6.0 1.4 5.7 6.4 0.7
4512 Book, periodical, and music stores 240 3.2 4.9 1.6 7.3 1.2 -5.7
452 General merchandise stores 2835 3.9 5.5 1.6 4.8 6.6 1.7
4521 Department stores 1711 1.1 3.3 2.2 -1.0 -0.1 0.8
4529 Other general merchandise stores 1124 8.3 9.2 0.8 10.9 14.2 3.0
453 Miscellaneous store retailers 1138 4.0 5.3 1.2 5.3 -0.1 -5.2
4531 Florists 146 2.8 1.6 -1.2 10.5 -2.4 -11.6
4532 Office supplies, stationery and gift stores 513 6.3 7.1 0.8 10.2 3.6 -6.0
4533 Used merchandise stores 127 2.7 7.4 4.6 5.5 4.4 -1.0
4539 Other miscellaneous store retailers 351 1.9 4.1 2.2 -1.3 -3.8 -2.5
454 Nonstore retailers 634 8.4 9.1 0.6 13.2 10.6 -2.3
4541 Electronic shopping and mail-order houses 250 12.4 16.9 4.0 17.9 14.4 -3.0
4542 Vending machine operators 78 0.8 -0.1 -0.9 0.9 0.3 -0.7
4543 Direct selling establishments 306 2.9 1.7 -1.1 7.3 5.0 -2.1
Food Services and Drinking Places
722 Food services and drinking places 8611 0.6 2.3 1.6 1.3 2.4 1.1
7221 Full-service restaurants 4084 0.8 2.5 1.7 1.3 3.1 1.8
7222 Limited-service eating places 3612 0.8 2.4 1.6 0.7 1.8 1.0
7223 Special food services 519 0.3 2.3 2.0 0.8 -0.2 -1.0
7224 Drinking places, alcoholic beverages 396 -1.5 -0.5 1.1 8.0 5.8 -2.1
Industry employment may not sum to aggregate levels due to rounding.
Table 2. Annual percent change in total compensation, output, and unit labor costs: retail trade, wholesale trade, and food services
and drinking places industries, 1987-02 and 2001-02
Annual percent change, 1987-02 Annual percent change 2001-02
NAICS Industry
code 2002
Employment Total Unit labor Total Unit labor
Wholesale Trade (thousands) compensation Output costs compensation Output costs
42 Wholesale trade 5842 4.8 4.1 0.7 -1.3 2.2 -3.4
423 Durable goods 3096 4.5 5.4 -0.9 -4.5 0.6 -5.1
4231 Motor vehicles and parts 360 3.7 3.6 0.1 1.4 5.1 -3.6
4232 Furniture and furnishings 116 4.5 2.3 2.2 1.9 -3.5 5.6
4233 Lumber and construction supplies 229 4.6 1.3 3.2 2.3 9.3 -6.4
4234 Commercial equipment 673 5.3 14.3 -7.9 -6.5 6.6 -12.3
4235 Metals and minerals 128 3.6 0.1 3.5 -2.5 -5.9 3.6
4236 Electric goods 374 4.6 9.9 -4.8 -10.7 -1.5 -9.3
4237 Hardware and plumbing 244 4.7 2.8 1.8 -1.3 1.0 -2.3
4238 Machinery and supplies 696 3.9 2.1 1.8 -4.6 -8.2 3.9
4239 Miscellaneous durable goods 276 4.2 3.1 1.0 -1.5 3.1 -4.4
424 Nondurable goods 2111 4.9 1.8 3.0 2.6 4.0 -1.3
4241 Paper and paper products 164 5.0 2.3 2.6 -0.4 1.2 -1.6
4242 Druggists' goods 215 10.3 6.7 3.3 6.8 14.8 -7.0
4243 Apparel and piece goods 158 3.4 1.7 1.7 1.7 4.9 -3.0
4244 Grocery and related products 711 4.8 2.8 2.0 5.3 4.6 0.7
4245 Farm product raw materials 79 1.5 0.2 1.3 -4.3 2.3 -6.5
4246 Chemicals 135 4.7 1.1 3.6 0.1 1.6 -1.5
4247 Petroleum 113 2.0 -0.6 2.6 -7.1 -0.4 -6.8
4248 Alcoholic beverages 134 4.1 2.0 2.1 4.7 6.6 -1.8
4249 Miscellaneous nondurable goods 402 4.3 -0.3 4.6 0.6 -8.4 9.8
425 Electronic markets and agents and brokers 636 6.5 6.3 0.1 3.3 2.7 0.6
42511 Business to business electronic markets 85 4.8 8.2 -3.2 -12.1 7.9 -18.5
42512 Wholesale trade agents and brokers 550 6.6 5.2 1.4 6.0 -0.7 6.7
Retail Trade
44, 45 Retail trade 15942 4.3 3.8 0.5 1.2 3.3 -2.0
441 Motor vehicle and parts dealers 1950 5.0 3.0 2.0 2.2 -0.6 2.9
4411 Automobile dealers 1304 5.3 2.8 2.4 2.7 -1.1 3.8
4412 Other motor vehicle dealers 145 6.3 5.2 1.1 6.3 5.8 0.5
4413 Auto parts, accessories, and tire stores 501 3.7 3.4 0.3 -1.1 -0.2 -1.0
442 Furniture and home furnishings stores 602 4.6 4.5 0.1 1.9 5.4 -3.2
4421 Furniture stores 313 4.3 4.3 0.0 1.0 6.0 -4.8
4422 Home furnishings stores 289 4.9 4.6 0.3 3.0 4.5 -1.4
443 Electronics and appliance stores 566 6.2 15.2 -7.9 -7.2 15.3 -19.5
444 Building material and garden supply stores 1206 4.7 4.9 -0.2 1.7 5.7 -3.9
4441 Building material and supplies dealers 1044 4.9 5.1 -0.2 1.8 6.5 -4.4
4442 Lawn and garden equipment and supplies store 162 3.1 3.4 -0.3 0.6 0.8 -0.1
445 Food and beverage stores 3014 3.4 0.5 2.9 1.8 0.5 1.4
4451 Grocery stores 2551 3.4 0.6 2.8 1.9 0.3 1.5
4452 Specialty food stores 303 4.1 -0.5 4.6 0.9 2.7 -1.7
4453 Beer, wine and liquor stores 160 2.8 0.3 2.5 2.9 1.0 1.8
446 Health and personal care stores 954 5.6 3.8 1.8 4.0 4.6 -0.6
447 Gasoline stations 924 2.3 1.7 0.6 -0.4 2.3 -2.7
448 Clothing and clothing accessories stores 1389 3.3 4.6 -1.2 4.5 5.5 -1.0
4481 Clothing stores 1003 3.7 5.0 -1.3 4.6 6.4 -1.6
4482 Shoe stores 185 1.9 2.5 -0.6 0.2 0.3 -0.1
4483 Jewelry, luggage, and leather goods stores 201 3.3 4.5 -1.1 6.9 6.0 0.8
451 Sporting goods, hobby, book, and music store 732 5.2 5.6 -0.4 0.8 4.6 -3.6
4511 Sporting goods and musical instrument stores 492 5.1 6.0 -0.9 2.7 6.4 -3.4
4512 Book, periodical, and music stores 240 5.4 4.9 0.6 -3.0 1.2 -4.1
452 General merchandise stores 2835 4.1 5.5 -1.4 4.0 6.6 -2.4
4521 Department stores 1711 4.0 3.3 0.7 0.4 -0.1 0.6
4529 Other general merchandise stores 1124 4.1 9.2 -4.7 9.8 14.2 -3.8
453 Miscellaneous store retailers 1138 3.8 5.3 -1.4 -4.6 -0.1 -4.5
4531 Florists 146 2.4 1.6 0.8 -11.0 -2.4 -8.9
4532 Office supplies, stationery and gift stores 513 4.1 7.1 -2.9 -6.6 3.6 -9.8
4533 Used merchandise stores 127 6.4 7.4 -0.9 0.5 4.4 -3.8
4539 Other miscellaneous store retailers 351 3.3 4.1 -0.8 -2.0 -3.8 1.9
454 Nonstore retailers 634 5.2 9.1 -3.6 -2.2 10.6 -11.6
4541 Electronic shopping and mail-order houses 250 9.3 16.9 -6.5 -3.1 14.4 -15.3
4542 Vending machine operators 78 2.1 -0.1 2.1 -6.0 0.3 -6.2
4543 Direct selling establishments 306 3.2 1.7 1.4 -0.4 5.0 -5.1
Food Services and Drinking Places
722 Food services and drinking places 8611 5.6 2.3 3.2 4.3 2.4 1.9
7221 Full-service restaurants 4084 6.1 2.5 3.5 5.1 3.1 1.9
7222 Limited-service eating places 3612 4.6 2.4 2.1 4.3 1.8 2.5
7223 Special food services 519 7.5 2.3 5.1 2.2 -0.2 2.4
7224 Drinking places, alcoholic beverages 396 4.6 -0.5 5.1 0.9 5.8 -4.6
Industry employment may not sum to aggregate levels due to rounding.