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March 1989, Vol. 112, No. 3
Productivity trends in agriculture chemicals
Horst Brand and Kelly Bryant
Output per hour of labor in the manufacture of synthetic fertilizers and pesticides rose at an average annual rate of 2.2 percent between 1972 and 1986.1 This rise reflected an increase of 1.3 percent a year in output and a decline of 0.9 percent a year in employee hours. The improvement in productivity compares with an average annual increase of 2.5 percent for manufacturing as a whole. As the following tabulation shows, productivity rates for the four individual agrochemical industries varied widely from the average for the group, with establishments producing nitrogenous fertilizer recording output-per-hour advances of close to 4 percent a year and establishments specializing in the mixing of fertilizers registering no strong trend at all. The pesticide industry stood in between, with a rate nearly equal to that for all manufacturing.
Average annual rate (percent), 1972-86
The long-term productivity trend slowed somewhat over the second half of the study period, from 3.9 percent annually for the industry group as a whole during 1972-79 to 2.5 percent a year during 1979-86. (See table 1.) Nitrogenous and phosphatic fertilizers did not partake in the slowdown, which was dominated by a deceleration in productivity in the pesticide industry. In contrast to the first half of the period, when growth in output was accompanied by (somewhat lower) gains in employee hours in all agricultural chemicals industries, both output and employee hours declined during the second half. With the latter declining more steeply than the former, productivity improved.
1 Agricultural chemicals are classified as No. 287 in the Standard Industrial Classification Manual published by the Office of management and Budget. The group of producers consists of establishments manufacturing nitrogenous fertilizer (SIC 2873), those producing phosphatic fertilizer (SIC 2874), those engaged in fertilizer mixing (SIC 2875), and those manufacturing pesticides and agricultural chemicals not else where classified (n.e.c; SIC 2879). Productivity and related measures have been computed by BLS for all four of the group's industry components, as well as for the three-digit group itself.
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