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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 25, 2019 USDL-19-1343
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 - 2018
Labor productivity rose 1.6 percent in wholesale trade, 3.2 percent in retail trade, and 1.6 percent
in food services and drinking places in 2018, 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 wholesale
trade and food services and drinking places and were unchanged in retail trade.
For wholesale trade in 2018, productivity, output, and hours worked all increased at a faster rate than
in 2017. In retail trade and food services and drinking places, the growth in output continued to outpace
the growth in hours worked in 2018. In these two industry groups, growth in hours worked was slower in
2018 compared to 2017 resulting in a larger productivity increase.
Among the six industries with the highest productivity growth, five reported growth in output while two
industries showed growth in hours worked. Productivity growth was greatest in book stores and news
dealers where the decline in hours worked far surpassed the decline in output.
Of the six industries with the largest declines in productivity, hours worked increased in all six and
output increased in two, other miscellaneous store retailers and specialty food stores. The two
industries with the greatest decrease in productivity were lawn and garden equipment and supplies stores
(-8.1 percent) and other motor vehicle dealers (-8.1 percent).
Labor Productivity Rose in Majority of Industries in 2018
Productivity increased in 13 of the 16 3-digit NAICS industries studied in 2018. Five industries had
productivity gains of at least 4.0 percent, with the highest in nonstore retailers (11.5 percent) which
also had the largest increase in output (9.8 percent). Among the three industries with productivity
declines, gasoline stations experienced the largest drop (-1.6 percent).
Productivity increased in 32 of the 49 4-digit NAICS industries studied in 2018. Output grew in 35
industries while hours worked grew in 29 industries.
In wholesale trade, productivity rose 1.6 percent as output grew 2.3 percent and hours worked increased
0.7 percent.
Productivity grew 3.6 percent in durable goods wholesalers and fell 1.3 percent in nondurable
goods wholesalers.
Productivity increased in 10 of the 19 4-digit wholesale trade industries while output rose in
11 industries and hours worked grew in 12.
The most rapid increase in productivity occurred in machinery and supply merchant wholesalers
(9.4 percent) because output grew at five times the rate of hours worked.
In retail trade, productivity increased by 3.2 percent as output grew faster (3.3 percent) than hours
worked (0.2 percent).
Productivity increased in 20 of the 27 4-digit retail trade industries while output grew in 20
industries and hours worked rose in 14.
The largest productivity increase occurred in book stores and news dealers (23.0 percent) as
hours worked declined at over four times the rate of output.
Electronic shopping and mail-order houses experienced the largest growth in output (10.6
percent) resulting in an 11.0 percent increase in productivity.
In food services and drinking places, productivity increased by 1.6 percent as growth in output (3.6
percent) outpaced growth in hours worked (2.0 percent).
Within this industry group, drinking places (alcoholic beverages) was the only 4-digit
industry with a productivity decline (-0.7 percent).
All three 4-digit industries had increases in hours worked and output.
Unit Labor Costs Decline in One Third of Industries in 2018
When productivity gains outpace hourly compensation, unit labor costs decline.
Unit labor costs fell in 6 out of 16 3-digit industries in 2018. All unit labor cost declines
occurred in industries where productivity rose.
Unit labor costs declined in 5 of 19 wholesale trade and 12 of 27 retail trade 4-digit
industries. Two of three food services and drinking places industries had increases in unit
labor costs.
Hourly compensation, defined as labor compensation per hour worked, rose in 41 of the 49
4-digit industries.
Labor Productivity Increases Over the Long Term in Most Industries
From 1987 to 2018, labor productivity increased at an average annual rate of 2.7 percent in wholesale
trade, 2.9 percent in retail trade, and 0.5 percent in food services and drinking places.
Among the 4-digit industries, productivity rose in 46 industries, declined in 2 industries,
and was unchanged in 1 industry from 1987 to 2018.
Of the 46 4-digit industries with increasing productivity growth, 43 experienced rising output
while 27 had an increase in hours worked.
Median productivity among 4-digit industries grew at an average annual rate of 1.9 percent.
Compared to the period 1987-2007, all three industry groups experienced a productivity slowdown
from 2007 to 2018.
The number of 4-digit industries with increasing productivity dropped from 45 out of 49 during
the 1987-2007 period to 34 during the 2007-2018 period.
Long-term Trends in Unit Labor Costs Vary by Sector
From 1987 to 2018, unit labor costs increased at an average annual rate of 3.0 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 15 out of 49 industries from 1987 to 2018.
Unit labor costs declined in 2 out of 19 wholesale trade and in 13 out of 27 retail trade
industries. Unit labor costs increased in all food services and drinking places industries.
From 2007 to 2018, unit labor costs declined in 13 out of 49 industries. All industries with
declines in unit labor costs experienced increases in productivity.
During the 1987 to 2007 and 2007 to 2018 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 Bureaus Service Annual Survey (November 2018), Annual Wholesale Trade Report (April 2019),
Monthly Wholesale Trade Survey (May 2019), Annual Retail Trade Survey (April 2019), Annual Revision of
the Monthly Retail and Food Services: Sales and Inventories (June 2019), and Nonemployer Statistics
(June 2019). Accordingly, the labor productivity and output series for all industries have been revised
for 2017 and earlier years. Additionally, the unit labor cost measures incorporate preliminary data from
the BLS Quarterly Census of Employment and Wages (June 2019).
Access the productivity data dashboard at www.bls.gov/lpc/lpc_by_industry_dashboard.xlsx for
Additional industries and sectors
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
Subscribe to productivity news releases on the BLS website at
https://subscriptions.bls.gov/accounts/USDOLBLS/subscriber/new.
Information in this release will be made available to sensory impaired individuals upon request.
Voice phone: (202) 691-5200; Federal Relay Service: (800) 877-8339.
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
2018 Employment (thousands)
Percent change, 2017-2018
Labor productivity
Unit labor costs
Output
Hours worked
Labor compensation
Wholesale Trade
Wholesale trade
42
5,977.1
1.6
1.4
2.3
0.7
3.7
Merchant wholesalers, durable goods
423
3,214.8
3.6
0.2
5.1
1.4
5.3
Motor vehicles and parts
4231
352.5
4.3
-0.8
3.9
-0.4
3.1
Furniture and furnishings
4232
119.7
-7.6
5.2
-0.7
7.5
4.4
Lumber and construction supplies
4233
247.3
-1.8
5.4
-0.7
1.1
4.6
Commercial equipment
4234
692.4
5.4
1.2
4.5
-0.8
5.7
Metals and minerals
4235
137.1
3.2
2.6
7.1
3.7
9.9
Appliances and electric goods
4236
359.5
2.6
-0.4
5.1
2.4
4.6
Hardware and plumbing
4237
280.8
-1.8
4.5
2.3
4.1
6.8
Machinery and supplies
4238
704.0
9.4
-5.2
11.5
1.9
5.7
Miscellaneous durable goods
4239
321.5
2.4
0.1
3.6
1.2
3.7
Merchant wholesalers, nondurable goods
424
2,206.4
-1.3
5.0
-1.0
0.3
4.0
Paper and paper products
4241
131.4
-4.1
3.3
-2.6
1.5
0.6
Druggists' goods
4242
237.3
-0.9
9.8
1.6
2.5
11.5
Apparel and piece goods
4243
155.7
0.4
2.6
-1.5
-1.8
1.1
Grocery and related products
4244
811.9
-1.9
3.6
-1.6
0.3
2.0
Farm product raw materials
4245
72.4
4.7
-2.7
-0.4
-4.9
-3.1
Chemicals
4246
150.8
-0.4
0.6
5.2
5.6
5.9
Petroleum
4247
103.9
-3.1
15.0
-4.3
-1.3
10.0
Alcoholic beverages
4248
201.3
0.3
1.0
3.4
3.1
4.4
Miscellaneous nondurable goods
4249
341.7
-1.6
4.1
-4.4
-2.8
-0.5
Electronic markets and agents and brokers
425
555.9
5.2
-7.6
2.6
-2.4
-5.2
Electronic markets and agents and brokers
4251
555.9
5.2
-7.6
2.6
-2.4
-5.2
Retail Trade
Retail trade
44-45
16,679.8
3.2
0.0
3.3
0.2
3.4
Motor vehicle and parts dealers
441
2,074.5
2.2
0.7
2.2
0.0
2.9
Automobile dealers
4411
1,332.4
2.6
-0.5
2.7
0.1
2.2
Other motor vehicle dealers
4412
169.6
-8.1
14.1
-3.2
5.4
10.4
Auto parts, accessories, and tire stores
4413
572.5
2.3
2.0
0.7
-1.6
2.7
Furniture and home furnishings stores
442
526.9
1.3
3.5
3.0
1.7
6.7
Furniture stores
4421
245.0
3.4
-0.7
6.5
3.0
5.7
Home furnishings stores
4422
281.9
-1.1
8.6
-0.8
0.3
7.8
Electronics and appliance stores
443
509.7
8.8
-3.9
7.0
-1.7
2.8
Electronics and appliance stores
4431
509.7
8.8
-3.9
7.0
-1.7
2.8
Building material and garden supply stores
444
1,336.4
-0.6
1.7
0.8
1.5
2.6
Building material and supplies dealers
4441
1,165.9
0.4
0.9
2.0
1.6
2.9
Lawn and garden equipment and supplies stores
4442
170.5
-8.1
7.9
-7.1
1.1
0.2
Food and beverage stores
445
3,166.4
3.1
-1.7
3.1
0.0
1.4
Grocery stores
4451
2,724.4
4.2
-2.3
3.1
-1.0
0.7
Specialty food stores
4452
262.7
-7.4
7.0
0.3
8.3
7.4
Beer, wine and liquor stores
4453
179.3
-0.6
-0.1
4.3
5.0
4.2
Health and personal care stores
446
1,114.2
2.4
-0.7
2.2
-0.2
1.5
Health and personal care stores
4461
1,114.2
2.4
-0.7
2.2
-0.2
1.5
Gasoline stations
447
941.8
-1.6
4.0
0.5
2.1
4.5
Gasoline stations
4471
941.8
-1.6
4.0
0.5
2.1
4.5
Clothing and clothing accessories stores
448
1,475.8
4.3
-3.2
5.6
1.2
2.2
Clothing stores
4481
1,095.4
4.2
-2.6
5.0
0.7
2.2
Shoe stores
4482
207.4
0.9
-3.4
4.6
3.7
1.1
Jewelry, luggage, and leather goods stores
4483
173.0
9.1
-6.5
9.8
0.7
2.7
Sports, hobby, music instruments, book stores
451
632.9
4.1
3.2
-3.2
-7.0
-0.2
Sporting goods and musical instrument stores
4511
547.2
1.8
3.4
-2.9
-4.6
0.4
Book stores and news dealers
4512
85.7
23.0
1.9
-5.4
-23.1
-3.6
General merchandise stores
452
3,114.4
2.2
-0.3
3.0
0.9
2.8
Department stores
4521
1,163.9
0.7
0.2
-0.1
-0.8
0.1
Other general merchandise stores
4529
1,950.5
2.1
0.3
3.9
1.8
4.2
Miscellaneous store retailers
453
987.8
3.1
1.5
3.5
0.4
5.1
Florists
4531
77.4
15.5
-7.8
4.9
-9.2
-3.3
Office supplies, stationery and gift stores
4532
261.7
9.0
-9.0
5.9
-2.8
-3.6
Used merchandise stores
4533
222.8
8.3
3.6
0.0
-7.7
3.6
Other miscellaneous store retailers
4539
425.9
-4.8
8.5
3.3
8.4
12.1
Nonstore retailers
454
799.0
11.5
1.1
9.8
-1.5
11.0
Electronic shopping and mail-order houses
4541
495.6
11.0
3.4
10.6
-0.4
14.3
Vending machine operators
4542
47.1
10.3
1.3
6.1
-3.8
7.5
Direct selling establishments
4543
256.3
7.7
-3.0
4.3
-3.2
1.2
Food Services and Drinking Places
Food services and drinking places
722
12,163.4
1.6
2.0
3.6
2.0
5.7
Special food services
7223
864.2
0.7
-0.5
5.6
4.8
5.1
Drinking places, alcoholic beverages
7224
407.3
-0.7
2.2
2.5
3.2
4.8
Restaurants and other eating places
7225
10,891.9
1.7
2.2
3.5
1.7
5.8
Table 2. Long run labor productivity, unit labor costs, and related data
United States Department of Labor
