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March, 1988, Vol. 111, No. 6
Productivity in industrial inorganic chemicalsHorst Brand and Ziaul Z. Ahmed
As measured by output per hour, productivity in the inorganic chemicals industry remained virtually unchanged between 1972 and 1986.1 By comparison, output per hour in manufacturing, as a whole, rose at an average annual rate of 2.7 percent over the period. Neither output of the industry nor employee hours changed significantly over the 1972-86 timespan the long -term trends were essentially flat.
The absence of any long-term improvement in productivity did not characterize all of the industry's components. In the manufacture of alkalis (mostly caustic soda) and chlorine, productivity rose 3.2 percent a year, reflecting a decline in output and an even greater decline in employee hours. In the manufacture of inorganic pigments, productivity improved at an 0.9-percent annual rate; here, too, the long-term gain resulted from receding output and hours. In the largest group of inorganic chemicalproductivity declined slightly, by 0.2 percent a year. Here, output rose, as did employee hours, if at a somewhat higher rate than output.
The inorganic chemicals industry converts certain nonfuel minerals and gaseous fluids found in the atmosphere into specifically formulated mixtures, generally used as intermediates in the production of final goods. One characteristic, particularly of large plants, is continuous processing, and relatively "very little direct labor (is) used" in the industry.2 Value added per production worker has been roughly twice that for all manufacturing, and the ratio of fixed assets to employment has been 3 to 4 times as high, bespeaking the capital intensity of the industry.3
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Footnotes1 Industrial inorganic chemicals are classified as No.281 in the Standard Industrial Classification Manual of the Office of Management and Budget. SIC 281 is composed of four 4-digit industries SIC 2812, Alkalies and Chlorine, consisting of establishments manufacturing these two chemicals and such other related chemicals as soda ash and caustic soda; SIC 2813, Industrial Gases, with establishments manufacturing such gases as acetylene, carbon dioxide, oxygen and others; SIC 2816, Inorganic Pigments, with establishments manufacturing pigments destined mostly for industrial paints, such as used for automobiles and household appliances; and SIC 2819, Industrial Inorganic Chemicals, not elsewhere classified, with establishments manufacturing a wide variety of bulk or commodity chemicals, such as acids, phosphates, potassiums, sulfurs, sodiums (salts), metallic compounds, and catalysts.
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