Internet: http://www.bls.gov/lpc/home.htm USDL 07-0823 

Technical information: (202) 691-5618 For release: 10:00 a.m. EDT 

Media contact: (202) 691-5902 Friday, June 8, 2007 

PRODUCTIVITY AND COSTS BY INDUSTRY: 

SELECTED SERVICE-PROVIDING AND MINING INDUSTRIES, 2005 

The Bureau of Labor Statistics of the U.S. Department of Labor reported today on 

productivity and costs for selected service-providing and mining industries in 2005. 

Labor productivity, defined as output per hour, rose in approximately two-thirds of the 42 

industries studied, about the same as in 2004. Unit labor costs declined in 17 out of 42 

industries. Over the long term period of 1987 to 2005, labor productivity increased in 

more industries than in 2005, and unit labor costs declined in fewer. 

Productivity and cost measures for three new industries are presented here for the 

first time: employment placement agencies (NAICS 56131), amusement and theme parks 

(NAICS 71311), and bowling centers (NAICS 71395). Productivity data for the 

manufacturing, retail trade, wholesale trade, and food services and drinking places 

industries are published in separate releases and can be accessed online at 

http://www.bls.gov/schedule/archives/prin_nr.htm. 

2004-2005 change 

In 2005, labor productivity increased in 26 of the 38 detailed service-providing 

industries and fell in 12 industries. (See table 1.) Three industries recorded double-digit 

growth. The biggest increase in output per hour, 34.4 percent, occurred in wireless 

telecommunications carriers (NAICS 5172). Labor productivity also grew by double 

digits in travel agencies (NAICS 56151), where output per hour increased 12.4 percent, 

and in photofinishing (NAICS 81292), where productivity grew 10.9 percent. The two 

industries where productivity fell the most, passenger car rental (NAICS 532111) and 

line-haul railroads (NAICS 482111), recorded declines of 6.6 percent and 5.4 percent, 

respectively. 

Labor productivity fell 10.1 percent in the mining sector (NAICS 21). Among the 

detailed industries covered, coal mining (NAICS 2121) showed the largest decline, 4.6 

percent. Nonmetallic mineral mining and quarrying (NAICS 2123) was the only mining 

industry with labor productivity growth, 2.2 percent. However, BLS does not publish 
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every detailed mining industry in the sector; therefore, results for the detailed industries 

shown in the table may not be consistent with the results shown for the sector as a whole. 

Unit labor costs, defined as the total labor costs required to produce a unit of 

output, rose in the majority of the service-providing industries. The biggest increase, 9.2 

percent, occurred in employment placement agencies (NAICS 56131). However, 15 of 

the 38 detailed service-providing industries reduced unit labor costs. Unit labor costs fell 

20.2 percent in wireless telecommunications carriers (NAICS 5172) and 11.5 percent in 

travel agencies (NAICS 56151), the two industries where productivity increased the 

most, and 10.7 percent in air transportation (NAICS 481). 

Unit labor costs increased rapidly in the mining sector. Growth in unit labor costs 

was especially strong in the oil and gas extraction industry (NAICS 211), rising 16.9 

percent in 2005. Only nonmetallic mineral mining and quarrying (NAICS 2123), the sole 

mining industry with productivity growth, recorded a reduction in unit labor costs of 2.9 

percent. 

Long-term trends 

Between 1987 and 2005, labor productivity in the detailed service-providing 

industries increased in 33 industries and fell in 5 industries. Software publishers (NAICS 

5112) recorded the fastest productivity growth over the period, 17.0 percent per year on 

average, followed by wireless telecommunications carriers (NAICS 5172) with average 

annual growth of 9.6 percent. Two industries in the transportation sector, used household 

and office goods moving (NAICS 48421) and couriers and messengers (NAICS 492), had 

the largest labor productivity declines, falling an average of 1.0 percent per year in both 

industries. 

Labor productivity in the mining sector (NAICS 21) grew 0.6 percent per year on 

average from 1987 to 2005. All four detailed mining industries experienced productivity 

gains. Both coal mining (NAICS 2121) and metal ore mining (NAICS 2122) recorded 

average annual growth of 3.4 percent, which was the highest among the mining 

industries. 

Unit labor costs among the detailed service-providing industries increased in 28 

industries and declined in 10 industries. Funeral homes and funeral services (NAICS 

81221) experienced the largest growth, 4.6 percent per year, followed by couriers and 

messengers (NAICS 492) with average annual growth of 4.4 percent. The most rapid 

declines in unit labor costs occurred in the two industries with the fastest productivity 

growth. Software publishers (NAICS 5112) reduced unit labor costs an average 10.0 

percent per year and wireless telecommunications carriers (NAICS 5172) showed a 

decline of 6.3 percent. 

Unit labor costs for the mining sector increased at an average annual rate of 4.0 

percent between 1987 and 2005, led by an increase of 5.1 percent in oil and gas 
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extraction (NAICS 211). Only coal mining (NAICS 2121) reduced unit labor costs, 

which fell an average 0.7 percent per year. 

Technical Note 

Output 

Industry output is measured as sectoral output, the total value, in real terms, of 

goods and services produced for sale outside the industry. Real industry output is most 

often derived by deflating nominal sales or value of production, but for some industries it 

is measured by physical quantities of output. Wherever possible, the indexes of industry 

output are calculated with a Törnqvist formula. This formula aggregates the growth rates 

of the various industry outputs between two periods, using their relative shares in 

industry value of production, averaged over the two periods, as weights. 

Industry output measures for service-providing and mining industries are 

constructed primarily using data from the economic censuses and annual surveys of the 

Bureau of the Census, U.S. Department of Commerce, together with information on 

price changes primarily from BLS. Other data sources include the U.S. Department of 

Transportation, the U.S. Department of Energy, the U.S. Geological Survey of the U.S. 

Department of the Interior, the U.S. Postal Service, the Federal Deposit Insurance 

Corporation, and the Postal Rate Commission. 

Labor Hours 

The industry labor input measures represent the hours of all workers in the 

industry. The primary source of data on employment and hours is the BLS Current 

Employment Statistics (CES) survey, which provides monthly data on the number of jobs 

held by wage and salary workers employed directly in nonfarm establishments. The CES 

survey also provides data on the average weekly hours of production and nonsupervisory 

workers in these establishments. 

Data from the BLS Current Population Survey (CPS) are used to supplement the 

CES data. The Division of Industry Productivity Studies (DIPS) estimates the average 

weekly hours of supervisory and nonproduction workers for each industry using data 

from the CPS together with the CES data. CPS data are also used to estimate the 

employment and hours of self-employed and unpaid family workers in most of the 

service-providing industries. The hours of nonsupervisory workers, supervisory workers, 

and self-employed and unpaid family workers are treated as homogeneous and are 

directly aggregated. 

Other sources of employment and hours data for service industries include the 

American Association of Railroads, the U.S. Department of Transportation, and the U.S. 

Postal Service. 
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Labor Productivity 

The industry labor productivity measures describe the relationship between output 

and the labor time involved in its production. They show the changes from period to 

period in the amount of goods and services produced per hour. Industry output per hour 

indexes are prepared from data published by various public and private agencies, using 

the greatest level of industry detail available. 

Although the labor productivity measures relate output to hours of employees or 

all persons engaged in an industry, they do not measure the specific contribution of labor, 

capital, or any other factor of production. Rather, they reflect the joint effects of many 

influences, including changes in technology; capital investment; level of output; 

utilization of capacity, energy, and materials; the use of purchased services inputs, 

including contract employment services; the organization of production; managerial skill; 

and the characteristics and effort of the workforce. 

Long-term trends tend to be more reliable indicators of the performance of an 

industry than are the year-to-year changes. The annual changes in an industry’s output 

and use of labor may reflect cyclical changes in the economy as well as long-term trends. 

Also, annual productivity indexes are based on sample data, which are likely to differ 

from data generated by a census of establishments in the industry. 

Unit Labor Costs 

 

The unit labor cost series represents the cost of labor input required to produce 

one unit of output. The indexes of unit labor costs for each industry are computed by 

dividing an index of industry labor compensation by an index of industry output. 

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 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. 

New Industries 

The introduction of productivity and cost measures for several new industries 

reflects the ongoing BLS effort to expand productivity measurement of the serviceproviding industries. The measurement of industry productivity and costs for these new 

industries follows standard BLS methods, as described above, wherever possible. To 

construct output measures for the employment placement agencies industry (NAICS 

56131), annual industry receipts were deflated with BLS producer price indexes (PPIs). 

The labor productivity measures for this industry begin in 1994 because no PPIs or other 

appropriate price series are available to deflate revenues prior to 1994. For amusement 
5

and theme parks (NAICS 71311) and bowling centers (NAICS 71395), detailed receipts 

were deflated with detailed price indexes from the Consumer Price Index (CPI) program. 

Notes 

The measures in this news release replace the mining, utilities, and service 

industry series published in the news release Productivity and Costs by Industry, Selected 

Service-Providing and Mining Industries, 2004 (released July 12, 2006), and in table 51 

of the Monthly Labor Review. All of the measures for 2005 in this release are 

preliminary and subject to revision. 

Published productivity and unit labor cost indexes for selected NAICS industries, 

including the industries covered in this report, can be accessed electronically by visiting 

the Labor Productivity and Costs Web site: http://www.bls.gov/lpc/home.htm. While the 

index numbers and rates of change reported by BLS in this news release are rounded to 

one decimal place, all percent changes in this release and on the BLS web site are 

calculated using index numbers to three decimal places, as found on the web site. 

Additional related measures for detailed service-providing industries, including 

industry employment, annual hours, the net value of production, and the implicit price 

deflator for output can be obtained by sending an email request to dipsweb@bls.gov, or 

by calling the Division of Industry Productivity Studies (202-691-5618). 

Material in this report is in the public domain and, with appropriate credit, may be 

used without permission. Information in this report will be made available to sensoryimpaired individuals upon request. Voice phone: 202-691-5618; TDD message referral 

phone number: 1-800-877-8339. 
Table 1. Percent change in output per hour, output, hours, compensation, and unit labor costs, 2004-2005

2005 Percent change, 2004-2005

NAICS Industry Employment Output Labor Unit labor

code (thousands) per hour Output Hours compensation costs

Mining Industries

21 Mining 562 -10.1 -2.1 8.9 16.7 19.1

211 Oil and gas extraction 126 -3.4 -3.6 -0.2 12.7 16.9

212 Mining, except oil and gas 213 -1.9 3.5 5.5 9.8 6.1

2121 Coal mining 74 -4.6 1.7 6.6 14.8 12.9

2122 Metal ore mining 29 -4.3 -1.6 2.9 11.6 13.4

2123 Nonmetallic mineral mining and quarrying 110 2.2 7.8 5.4 4.6 -2.9

Service-Providing Industries

Utilities

2211 Power generation and supply 401 6.2 5.2 -1.0 1.3 -3.7

2212 Natural gas distribution 107 4.4 -1.0 -5.1 1.9 2.9

Transportation and Warehousing

481 Air transportation 472 7.7 5.3 -2.2 -6.0 -10.7

482111 Line-haul railroads 182 -5.4 0.2 5.9 5.5 5.4

48412 General freight trucking, long-distance 901 1.7 5.1 3.3 8.2 3.0

48421 Used household and office goods moving 106 -0.2 5.4 5.6 4.2 -1.2

491 Postal service 774 1.1 1.2 0.2 3.4 2.2

492 Couriers and messengers 612 -1.7 -0.6 1.2 0.7 1.2

Information

511 Publishing 953 4.1 3.6 -0.6 4.5 0.9

5111 Newspaper, book, and directory publishers 714 1.6 0.5 -1.1 3.3 2.8

5112 Software publishers 239 6.5 7.6 1.1 6.2 -1.3

51213 Motion picture and video exhibition 135 -1.1 -6.6 -5.5 -1.8 5.1

515 Broadcasting, except internet 341 4.6 6.6 1.9 8.7 2.0

5151 Radio and television broadcasting 249 5.1 5.1 0.0 6.2 1.1

5152 Cable and other subscription programming 92 2.4 9.1 6.5 17.6 7.8

5171 Wired telecommunications carriers 519 4.7 -1.8 -6.1 -4.2 -2.4

5172 Wireless telecommunications carriers 194 34.4 28.2 -4.6 2.3 -20.2

5175 Cable and other program distribution 137 -2.9 5.4 8.5 14.0 8.1

Finance and Insurance

52211 Commercial banking 1296 -0.1 2.2 2.4 10.8 8.4

Real Estate and Rental and Leasing

532111 Passenger car rental 129 -6.6 3.2 10.5 7.7 4.3

53212 Truck, trailer and RV rental and leasing 63 7.3 9.0 1.6 3.0 -5.5

53223 Video tape and disc rental 151 0.7 -3.0 -3.7 -4.3 -1.4

Professional and Technical Services

541213 Tax preparation services 142 6.9 6.3 -0.6 -0.5 -6.4

54131 Architectural services 219 4.8 10.9 5.9 12.7 1.6

54133 Engineering services 879 5.9 13.3 6.9 10.6 -2.4

54181 Advertising agencies 184 -1.4 1.2 2.6 7.2 6.0

541921 Photography studios, portrait 80 0.4 4.3 3.9 0.3 -3.9

Administrative and Support Services

56131 Employment placement agencies 298 -1.5 3.0 4.6 12.4 9.2

56151 Travel agencies 124 12.4 9.2 -2.9 -3.4 -11.5

56172 Janitorial services 1146 4.7 5.4 0.7 2.9 -2.4
Table 1. Percent change in output per hour, output, hours, compensation, and unit labor costs, 2004-2005

2005 Percent change, 2004-2005

NAICS Industry Employment Output Labor Unit labor

code (thousands) per hour Output Hours compensation costs

Health Care and Social Assistance

6215 Medical and diagnostic laboratories 204 -1.4 3.7 5.2 3.5 -0.2

621511 Medical laboratories 140 -2.7 2.6 5.5 1.9 -0.7

621512 Diagnostic imaging centers 64 0.9 5.3 4.4 6.8 1.4

Arts, Entertainment, and Recreation

71311 Amusement and theme parks 144 8.4 3.2 -4.8 4.4 1.1

71395 Bowling centers 79 -1.7 -3.9 -2.3 1.7 5.8

Accommodation and Food Services

7211 Traveler accommodations 1794 -4.1 0.6 4.9 7.0 6.3

Other Services

8111 Automotive repair and maintenance 1182 0.5 2.2 1.7 5.5 3.3

81211 Hair, nail and skin care services 909 4.3 4.3 0.0 5.0 0.7

81221 Funeral homes and funeral services 111 0.3 0.4 0.1 1.5 1.1

8123 Drycleaning and laundry services 362 9.2 2.7 -5.9 -3.3 -5.9

81292 Photofinishing 32 10.9 -14.8 -23.2 -16.6 -2.2
Table 2. Average annual percent change in output per hour, output, hours, compensation, and unit labor costs, 1987-2005

Average annual percent change, 1987-2005

NAICS Industry Output Labor Unit labor

code per hour Output Hours compensation costs

Mining Industries

21 Mining 0.6 -0.4 -1.0 3.7 4.0

211 Oil and gas extraction 1.7 -1.1 -2.7 4.0 5.1

212 Mining, except oil and gas 2.7 1.1 -1.6 1.3 0.2

2121 Coal mining 3.4 0.1 -3.2 -0.6 -0.7

2122 Metal ore mining 3.4 1.9 -1.5 2.8 0.9

2123 Nonmetallic mineral mining and quarrying 1.6 1.5 0.0 3.3 1.7

Service-Providing Industries

Utilities

2211 Power generation and supply 3.1 1.3 -1.8 2.8 1.5

2212 Natural gas distribution 3.4 1.3 -2.0 3.2 1.9

Transportation and Warehousing

481 Air transportation 2.9 3.6 0.6 3.4 -0.1

482111 Line-haul railroads 4.9 2.5 -2.3 1.0 -1.4

48412 General freight trucking, long-distance 1.5 3.4 1.8 3.7 0.3

48421 Used household and office goods moving -1.0 0.6 1.6 4.4 3.8

491 Postal service 1.1 1.2 0.1 4.1 2.8

492 Couriers and messengers -1.0 2.4 3.4 6.9 4.4

Information

511 Publishing 4.3 5.0 0.7 5.8 0.8

5111 Newspaper, book, and directory publishers 0.2 -0.3 -0.5 3.6 3.9

5112 Software publishers 17.0 25.2 7.1 12.7 -10.0

51213 Motion picture and video exhibition 0.7 2.0 1.3 3.9 1.9

515 Broadcasting, except internet 0.9 2.4 1.5 5.4 2.9

5151 Radio and television broadcasting 0.2 0.5 0.3 4.3 3.8

5152 Cable and other subscription programming 2.4 8.2 5.6 11.5 3.0

5171 Wired telecommunications carriers 5.1 3.6 -1.5 2.4 -1.1

5172 Wireless telecommunications carriers 9.6 24.3 13.5 16.5 -6.3

5175 Cable and other program distribution 0.3 5.8 5.5 10.2 4.2

Finance and Insurance

52211 Commercial banking 2.2 2.0 -0.2 5.7 3.6

Real Estate and Rental and Leasing

532111 Passenger car rental 1.0 3.7 2.7 6.8 3.0

53212 Truck, trailer and RV rental and leasing 5.0 4.8 -0.2 3.7 -1.0

53223 Video tape and disc rental 4.0 6.8 2.7 5.1 -1.6

Professional and Technical Services

541213 Tax preparation services 1.4 4.4 2.9 4.1 -0.2

54131 Architectural services 1.8 4.1 2.3 5.9 1.8

54133 Engineering services 1.3 3.5 2.1 6.5 2.9

54181 Advertising agencies 1.8 1.7 0.0 4.9 3.2

541921 Photography studios, portrait -0.3 2.7 3.0 4.9 2.1

Administrative and Support Services

56131 Employment placement agencies 1/ 2.6 5.7 3.0 8.9 3.0

56151 Travel agencies 4.2 3.3 -0.9 4.7 1.4

56172 Janitorial services 2.7 4.6 1.8 5.9 1.3
Table 2. Average annual percent change in output per hour, output, hours, compensation, and unit labor costs, 1987-2005

Average annual percent change, 1987-2005

NAICS Industry Output Labor Unit labor

code per hour Output Hours compensation costs

Health Care and Social Assistance

6215 Medical and diagnostic laboratories 1/ 3.9 7.2 3.2 6.0 -1.1

621511 Medical laboratories 1/ 3.0 5.9 2.8 5.1 -0.7

621512 Diagnostic imaging centers 1/ 5.1 9.4 4.1 8.0 -1.3

Arts, Entertainment, and Recreation

71311 Amusement and theme parks -0.1 2.8 2.9 6.8 3.9

71395 Bowling centers 0.0 -1.2 -1.2 1.3 2.6

Accommodation and Food Services

7211 Traveler accommodations 1.7 2.9 1.1 5.6 2.7

Other Services

8111 Automotive repair and maintenance 1.5 2.6 1.1 4.5 1.9

81211 Hair, nail and skin care services 2.5 3.5 1.0 5.6 2.0

81221 Funeral homes and funeral services -0.6 0.3 0.9 4.9 4.6

8123 Drycleaning and laundry services 1.2 0.6 -0.7 3.0 2.5

81292 Photofinishing 0.9 -4.3 -5.2 -1.1 3.4

1/ For NAICS industries 56131, 6215, 621511, and 62512, average annual percent changes cover 1994-2005.