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Productivity and Costs by Industry: Wholesale Trade, Retail Trade, and Food Services and Drinking Places News Release
For release 10:00 a.m. (EDT) Thursday, July 19, 2018 USDL-18-1181
Technical Information: (202) 691-5606 • productivity@bls.gov • www.bls.gov/lpc
Media Contact: (202) 691-5902 • PressOffice@bls.gov
PRODUCTIVITY AND COSTS BY INDUSTRY: WHOLESALE TRADE,
RETAIL TRADE, AND FOOD SERVICES AND DRINKING PLACES INDUSTRIES - 2017
Labor productivity rose 2.7 percent in wholesale trade and 2.8 percent in retail trade, and declined by
2.2 percent in food services and drinking places in 2017, the U.S. Bureau of Labor Statistics reported
today. Unit labor costs, which reflect the total labor costs required to produce a unit of output, rose
in food services and drinking places and fell in wholesale trade and retail trade.
For wholesale trade in 2017, productivity, output, and hours worked all increased at a faster rate than
in 2016. In retail trade, the growth in output continued to outpace the growth in hours worked in 2017
but led to a smaller productivity increase than in 2016. Productivity in food services and drinking
places declined in 2017 due to hours worked increasing at a faster rate than output. In 2016,
productivity increased in this industry group as a result of output growing at a faster rate than hours
worked.
Labor Productivity Rose in Majority of Industries in 2017
Productivity increased in 12 of the 16 3-digit NAICS industries studied in 2017. Seven industries had
productivity gains of at least 4.0 percent, including nonstore retailers which also had the largest
increase in output (10.6 percent). Among the three industries with productivity declines, gasoline
stations experienced the largest drop (-3.2 percent).
Productivity increased in 32 of the 49 4-digit NAICS industries studied in 2017. Output grew in 34
industries while hours worked grew in 31 industries.
In wholesale trade, productivity rose 2.7 percent as output grew 3.7 percent and hours worked
increased 0.9 percent.
* Productivity grew 5.1 percent in durable goods wholesalers and 1.1 percent in nondurable
goods wholesalers.
* Productivity increased in 13 of the 19 4-digit wholesale trade industries while output rose
in 15 industries and hours worked grew in 13.
* Productivity increased most rapidly in motor vehicles and parts due to rapid growth in output
and a slight increase in hours worked.
In retail trade, productivity increased by 2.8 percent, driven by growth in both output (3.9 percent)
and hours worked (1.0 percent).
* Productivity increased in 18 of the 27 4-digit retail trade industries while output grew in
17 industries and hours worked rose in 15.
* The largest productivity increases occurred in other motor vehicle dealers and in home
furnishings stores as output rose and hours worked declined in both industries.
* Other motor vehicle dealers experienced the largest growth in output (17.2 percent) resulting
in a 17.3 percent increase in productivity.
In food services and drinking places, productivity declined by 2.2 percent as growth in hours worked
(2.7 percent) outpaced growth in output (0.5 percent).
* Drinking places (alcoholic beverages) was the only industry out of the three to experience
productivity growth (6.5 percent).
* All three 4-digit industries had increases in hours worked while special food services was
the only industry to have a decline in output.
Unit Labor Costs Decline in About Half of the Industries in 2017
When productivity gains outpace hourly compensation, unit labor costs decline.
* Unit labor costs fell in 8 out of 16 3-digit industries in 2017. All unit labor cost declines
occurred in industries where productivity rose.
* Unit labor costs declined in 8 of 19 wholesale trade and 14 of 27 retail trade 4-digit
industries. Two of the food services and drinking places industries experienced an increase in
unit labor costs.
* Hourly compensation, defined as labor compensation per hour worked, rose in 42 of the 49
4-digit industries.
Long-term Productivity Slowdown Reflected in All Three Industry Groups
From 1987 to 2017, labor productivity increased at an average annual rate of 2.8 percent in wholesale
trade, 2.9 percent in retail trade, and 0.4 percent in food services and drinking places.
* Among the 4-digit industries, productivity rose in all but two industries from 1987 to 2017.
Median productivity among these industries grew at an average annual rate of 1.8 percent.
* Of the 47 4-digit industries with increasing productivity growth, 43 experienced rising output
while 23 had an increase in hours worked.
* All three industry groups experienced a slowdown in productivity growth from 2007 to 2017.
Productivity increased in 45 out of 49 4-digit industries from 1987 to 2007 compared to 33
industries from 2007 to 2017.
From 1987 to 2017, unit labor costs increased at an average annual rate of 3.2 percent in food services
and drinking places, the greatest change among the three industry groups. Unit labor costs increased by
0.9 percent in wholesale trade and were unchanged in retail trade.
* Among the 4-digit industries, unit labor costs fell in 14 out of 49 industries from 1987 to 2017.
Unit labor costs declined in 2 out of 19 wholesale trade and in 12 out of 27 retail trade
industries and increased in all food services and drinking places industries.
* From 2007 to 2017, unit labor costs declined in 15 out of 49 industries. All industries with
declines in unit labor costs experienced increases in productivity.
* During the 1987 to 2007 and 2007 to 2017 periods, electronics and appliance stores had the largest
unit labor cost declines and the largest productivity gains among the 3-digit industries.
Additional Information
The trade and food services and drinking places measures in this release incorporate benchmark data from
the Census Bureau’s Service Annual Survey (November 2017), Annual Wholesale Trade Report (March 2018),
Monthly Wholesale Trade Survey (May 2018), Annual Retail Trade Survey (March 2018), Annual Revision of
the Monthly Retail and Food Services: Sales and Inventories (May 2018), and Nonemployer Statistics (June
2018). Data have been benchmarked to the final results of the 2012 Economic Census. Accordingly, the labor
productivity and output series for all industries have been revised for 2016 and earlier years.
Additionally, the unit labor cost measures incorporate preliminary data from the BLS Quarterly Census of
Employment and Wages (June 2018).
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* - Detailed data series: indexes of productivity and related measures; rates of change; and *
* levels of industry employment, hours worked, nominal value of production, and labor compensation *
* - Additional years and long-term data *
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Technical Note
Labor Productivity: Labor productivity describes the relationship between real output and the labor
hours involved in its production. These measures show the changes from period to period in the
amount of goods and services produced per hour worked. Although the labor productivity measures
relate output in an industry to hours worked of all persons in that industry, they do not measure
the specific contribution of labor to growth in output. Rather, they reflect the joint effects of
many influences, including: changes in technology; capital investment; utilization of capacity,
energy, and materials; the use of purchased services inputs, including contract employment services;
the organization of production; the characteristics and effort of the workforce; and managerial
skill.
Unit Labor Costs: Unit labor costs represent the cost of labor required to produce one unit of
output. The unit labor cost indexes are computed by dividing an index of nominal industry labor
compensation by an index of real industry output. Unit labor costs also describe the relationship
between compensation per hour worked (hourly compensation) and real output per hour worked (labor
productivity). When hourly compensation growth outpaces productivity, unit labor costs increase.
Alternatively, when productivity growth exceeds hourly compensation, unit labor costs decrease.
Output: Industry output is measured as an annual-weighted index of the changes in the various
products (in real terms) provided for sale outside the industry. Real industry output for data in
this release is derived by deflating nominal sales or values of production using price indexes.
Industry output measures are constructed primarily using data from the economic censuses and annual
surveys of the U.S. Census Bureau, U.S. Department of Commerce, together with information on price
changes from BLS.
Labor Hours: Labor hours are measured as annual hours worked by all employed persons in an industry.
Data on industry employment and hours come primarily from the BLS Current Employment Statistics (CES)
survey and Current Population Survey (CPS). CES data on the number of total and production worker
jobs held by wage and salary workers in nonfarm establishments are supplemented with CPS data on
self-employed and unpaid family workers to estimate industry employment. Hours worked estimates are
derived using CES and CPS employment, CES data on the average weekly hours paid of production workers,
CPS data on hours of nonproduction, self-employed, and unpaid family workers, and ratios of hours
worked to hours paid based on data from the National Compensation Survey (NCS). For some industries,
employment and hours data are supplemented or further disaggregated using data from the BLS Quarterly
Census of Employment and Wages (QCEW), the Census Bureau, or other sources. Hours worked are estimated
separately for different types of workers and then are directly aggregated; no adjustments for labor
composition are made.
Labor Compensation: Labor compensation, defined as payroll plus supplemental payments, is a measure
of the cost to the employer of securing the services of labor. Payroll includes salaries, wages,
commissions, dismissal pay, bonuses, vacation and sick leave pay, and compensation in kind.
Supplemental payments include both legally required expenditures and payments for voluntary programs.
The legally required portion consists primarily of federal old age and survivors’ insurance,
unemployment compensation, 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. Industry compensation measures are constructed primarily using data from
the BLS QCEW and the economic censuses of the Census Bureau, U.S. Department of Commerce.
Table 1. Recent labor productivity, unit labor costs, and related data
Industry
2012 NAICS code
2017 Employment (thousands)
Percent change, 2016-2017
Labor productivity
Unit labor costs
Output
Hours worked
Labor compensation
Wholesale Trade
Wholesale trade
42
6,039.5
2.7
-0.9
3.7
0.9
2.7
Merchant wholesalers, durable goods
423
3,034.4
5.1
-3.0
6.3
1.1
3.1
Motor vehicles and parts
4231
347.3
7.9
-4.8
8.9
0.9
3.7
Furniture and furnishings
4232
111.7
-0.9
2.4
-1.1
-0.2
1.2
Lumber and construction supplies
4233
233.0
0.2
4.6
4.8
4.6
9.6
Commercial equipment
4234
630.4
5.4
-2.5
5.1
-0.3
2.5
Metals and minerals
4235
125.4
4.8
-1.9
4.3
-0.5
2.3
Appliances and electric goods
4236
336.1
5.5
-4.9
7.6
2.1
2.4
Hardware and plumbing
4237
257.2
-2.2
5.8
1.1
3.3
6.9
Machinery and supplies
4238
672.0
5.7
-4.3
6.3
0.6
1.7
Miscellaneous durable goods
4239
321.3
4.3
-3.6
5.5
1.1
1.7
Merchant wholesalers, nondurable goods
424
2,103.9
1.1
1.8
0.6
-0.5
2.4
Paper and paper products
4241
121.2
-4.1
1.9
-1.8
2.5
0.1
Druggists' goods
4242
203.1
2.0
0.6
0.5
-1.4
1.1
Apparel and piece goods
4243
153.7
-2.1
6.9
-5.3
-3.3
1.2
Grocery and related products
4244
784.0
-0.1
2.4
1.2
1.3
3.7
Farm product raw materials
4245
74.5
-1.9
5.8
-0.5
1.4
5.3
Chemicals
4246
132.2
1.4
2.5
2.1
0.7
4.6
Petroleum
4247
98.2
1.0
3.3
1.5
0.5
4.9
Alcoholic beverages
4248
199.8
0.9
0.1
1.7
0.8
1.9
Miscellaneous nondurable goods
4249
337.2
6.4
-0.7
0.6
-5.5
-0.1
Electronic markets and agents and brokers
425
901.2
0.1
-1.7
4.0
3.9
2.3
Electronic markets and agents and brokers
4251
901.2
0.1
-1.7
4.0
3.9
2.3
Retail Trade
Retail trade
44-45
16,702.7
2.8
-0.9
3.9
1.0
3.0
Motor vehicle and parts dealers
441
2,066.3
4.8
-3.2
5.6
0.7
2.2
Automobile dealers
4411
1,330.1
4.5
-3.5
5.3
0.8
1.7
Other motor vehicle dealers
4412
161.6
17.3
-10.4
17.2
-0.1
5.0
Auto parts, accessories, and tire stores
4413
574.6
-1.6
4.2
-0.9
0.7
3.3
Furniture and home furnishings stores
442
515.0
9.7
-4.3
7.5
-2.0
2.9
Furniture stores
4421
237.4
5.0
-2.4
4.1
-0.9
1.6
Home furnishings stores
4422
277.6
15.1
-6.4
11.4
-3.2
4.3
Electronics and appliance stores
443
520.3
9.0
-4.7
3.5
-5.1
-1.4
Electronics and appliance stores
4431
520.3
9.0
-4.7
3.5
-5.1
-1.4
Building material and garden supply stores
444
1,317.7
5.3
-4.1
7.3
1.9
2.9
Building material and supplies dealers
4441
1,145.7
4.1
-3.4
6.3
2.2
2.7
Lawn and garden equipment and supplies stores
4442
172.0
13.6
-8.2
14.2
0.6
4.8
Food and beverage stores
445
3,185.0
0.2
0.5
2.1
1.9
2.6
Grocery stores
4451
2,762.4
-0.3
1.2
1.9
2.2
3.1
Specialty food stores
4452
248.8
5.6
-7.8
7.2
1.4
-1.2
Beer, wine and liquor stores
4453
173.8
4.4
-2.7
2.7
-1.7
-0.1
Health and personal care stores
446
1,115.6
-2.2
3.0
-0.2
2.1
2.8
Health and personal care stores
4461
1,115.6
-2.2
3.0
-0.2
2.1
2.8
Gasoline stations
447
940.0
-3.2
7.3
-2.2
1.0
4.9
Gasoline stations
4471
940.0
-3.2
7.3
-2.2
1.0
4.9
Clothing and clothing accessories stores
448
1,482.7
0.0
1.8
1.4
1.3
3.2
Clothing stores
4481
1,097.2
-2.3
2.9
1.4
3.8
4.3
Shoe stores
4482
217.3
8.5
0.4
-1.0
-8.7
-0.5
Jewelry, luggage, and leather goods stores
4483
168.2
1.4
-1.8
3.6
2.2
1.8
Sports, hobby, music instruments, book stores
451
664.3
1.2
0.0
-0.9
-2.2
-0.9
Sporting goods and musical instrument stores
4511
573.5
1.9
-0.1
-0.6
-2.5
-0.7
Book stores and news dealers
4512
90.8
-3.1
0.6
-2.8
0.3
-2.2
General merchandise stores
452
3,149.1
0.2
-1.2
2.8
2.6
1.5
Department stores
4521
1,194.8
2.3
-5.5
-0.2
-2.5
-5.7
Other general merchandise stores
4529
1,954.3
-1.7
2.0
3.7
5.5
5.8
Miscellaneous store retailers
453
976.4
6.0
-0.9
2.2
-3.6
1.3
Florists
4531
75.6
7.7
2.2
4.2
-3.3
6.5
Office supplies, stationery and gift stores
4532
274.6
4.9
3.9
-4.8
-9.2
-1.1
Used merchandise stores
4533
226.7
12.8
-7.9
12.1
-0.7
3.2
Other miscellaneous store retailers
4539
399.5
4.4
-1.2
2.5
-1.8
1.3
Nonstore retailers
454
770.3
6.1
1.5
10.6
4.2
12.3
Electronic shopping and mail-order houses
4541
468.7
7.1
3.3
12.5
5.1
16.2
Vending machine operators
4542
46.6
-12.4
15.1
-0.9
13.2
14.0
Direct selling establishments
4543
255.0
-2.8
3.4
-2.0
0.8
1.3
Food Services and Drinking Places
Food services and drinking places
722
11,961.0
-2.2
5.7
0.5
2.7
6.2
Special food services
7223
844.4
-9.2
12.6
-3.7
6.1
8.4
Drinking places, alcoholic beverages
7224
408.0
6.5
-6.7
14.0
7.0
6.4
Restaurants and other eating places
7225
10,708.6
-1.9
5.6
0.3
2.3
5.9
Table 2. Long run labor productivity, unit labor costs, and related data
United States Department of Labor
