Productivity Rose in Two-thirds of Detailed Trade and Food Services

News

Labor productivity - defined as output per hour - rose in wholesale trade and in retail trade but fell
slightly in food services and drinking places in 2012, the U.S. Bureau of Labor Statistics reported today.
Productivity changes were as follows:

2.5 percent in wholesale trade,
2.4 percent in retail trade, and
-0.1 percent in food services and drinking places.

Productivity grew faster in wholesale trade and retail trade in 2012 than in 2011, as output increased at
the same rate as in the previous year for wholesale trade and more rapidly for retail trade, while hours
rose more slowly in both sectors than in 2011. In food services and drinking places, output
and hours both rose more rapidly in 2012 than in 2011, but hours rose faster than output.

Unit labor costs, which reflect the total labor costs required to produce a unit of output, fell in retail
trade but rose in wholesale trade and in food services and drinking places in 2012.

Productivity increased in 33 of the 50 detailed 4-digit NAICS industries in 2012. Output grew in 41
industries and hours increased in 33 industries. Unit labor costs fell in 22 industries in 2012.

In wholesale trade, labor productivity rose 2.5 percent as output grew 3.9 percent and hours increased
1.4 percent. Productivity grew 5.0 percent in durable goods wholesalers and 0.1 percent in nondurable
goods wholesalers. Output per hour increased in 11 of the 19 wholesale trade industries, while output
rose in 15 industries and hours grew in 14. Productivity increased most rapidly in motor vehicles and
parts wholesalers, lumber and construction supplies wholesalers, and metals and minerals wholesalers, as
output rose substantially in each. Unit labor costs declined in 7 industries.

In retail trade, labor productivity grew 2.4 percent as output increased 3.7 percent and hours rose 1.2
percent. Output per hour increased in 19 of the 27 detailed retail trade industries in 2012, as output grew
in 22 industries and hours rose in 16. The largest productivity increases were in home furnishing stores,
where output rose considerably more than hours, in furniture stores, where output rose despite a decline
in hours, and in book, periodical, and music stores, where output fell but hours declined even more. Unit
labor costs fell in 14 industries.

In food services and drinking places, labor productivity declined 0.1 percent, as output grew 4.6
percent and hours rose 4.7 percent. Productivity increased in three of the four detailed industries in this
sector, as output grew in four industries and hours increased in three. Productivity rose most in drinking
places, alcoholic beverages, where output increased and hours fell. Productivity fell in limited-service
eating places, where hours rose more rapidly than output. Unit labor costs rose in three of the industries.

Over the longer term (1987 to 2012), productivity in the wholesale trade, retail trade, and food services
and drinking places sectors advanced more rapidly than in 2012. From 1987 to 2012, output per hour
increased at an average annual rate of 3.0 percent in wholesale trade, 2.8 percent in retail trade, and 0.6
percent in food services and drinking places. During this period unit labor costs rose in wholesale trade
and in food services and drinking places, but were unchanged in retail trade.

Productivity also increased in more trade and food services and drinking places industries over the longer
term than in 2012, with output per hour rising in 47 of the 50 detailed industries from 1987 to 2012. Unit
labor costs fell in 18 of the detailed industries over the period.

Year-to-year movements in industry productivity may be erratic, particularly in smaller industries. The
annual measures based on sample data may differ from measures generated by a census of
establishments in the industry. Annual changes in an industry’s output and use of labor may reflect
cyclical changes in the economy as well as long-term trends. As a result, long-term productivity trends
tend to be more reliable indicators of industry performance than year-to-year changes.

Industry labor productivity measures are updated and revised as new data become available. The latest
industry productivity data for trade and food services and drinking places industries and industries in
other sectors are available on the BLS Labor Productivity and Costs website at www.bls.gov/lpc.

The measures in this news release incorporate preliminary data from the Census Bureau’s Annual
Labor productivity (output per hour) rose in wholesale trade and in retail trade but fell slightly in food services and drinking places in 2012. Productivity grew in two-thirds of the detailed trade and food services industries last year.

Wholesale Trade Report (March 2013), Monthly Wholesale Trade Survey (May 2013), Annual Retail
Trade Survey (April 2013), and the Annual Revision of the Monthly Retail and Food Services: Sales and
Inventories (May 2013), as well as data from the Census Bureau’s Nonemployer Statistics (May 2013).
The labor productivity and output series for all industries have been revised for 2011 and earlier years as
a result. This news release also incorporates the annual benchmark revision of the BLS Current
Employment Statistics (CES) survey published in February 2013. In addition, the unit labor cost
measures incorporate preliminary data from the BLS Quarterly Census of Employment and Wages (June
2013). All of the measures for 2012 in this release are preliminary and subject to revision.

The industries included in this release are classified according to the 2007 NAICS. While the rates of
change reported by BLS in this news release are rounded to one decimal place, all industry productivity
percent changes are calculated using index numbers rounded to three decimal places.

More detailed data, including indexes, annual rates of change, and levels are available on the Labor
Productivity and Costs website at http://www.bls.gov/lpc/. Additional information can be obtained by
calling the Division of Industry Productivity Studies (202-691-5618) or by sending a request by e-mail
to dipsweb@bls.gov. Information in this report will be made available to sensory-impaired individuals
upon request. Voice phone: 202-691-5618; TDD message referral phone number: 1-800-877-8339.