Internet: http://www.bls.gov/lpc/home.htm USDL 07-1321 

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

Media contact: (202) 691-5902 Tuesday, August 28, 2007 

PRODUCTIVITY AND COSTS BY INDUSTRY: 

WHOLESALE TRADE, RETAIL TRADE, 

AND FOOD SERVICES AND DRINKING PLACES, 2006 

 Labor productivity—defined as output per hour—increased in wholesale trade, 

retail trade, and food services and drinking places in 2006 as follows: 

4.3 percent in wholesale trade 

4.9 percent in retail trade and 

2.4 percent in food services and drinking places. 

Output grew in each of these sectors in 2006. Hours rose in wholesale trade and in food 

services and drinking places, but fell in retail trade. (See chart 1.) Productivity advanced 

in 42 of the 50 industries studied, as output grew in 40 industries while hours declined in 

21 industries. Unit labor costs fell in half of the detailed industries measured and in the 

retail trade sector, but increased in the wholesale trade and food services and drinking 

places sectors overall. (See table 1.) 

 From 1987 to 2006, labor productivity increased at the following average annual 

rates: 

3.5 percent in wholesale trade 

3.4 percent in retail trade and 

0.8 percent in food services and drinking places. 

Output and hours rose in each of these sectors over the period. (See chart 2.) 

Productivity and output increased in 47 of the 50 detailed industries, while hours fell in 

13 industries. Unit labor costs declined in 18 industries and in the retail trade sector, but 

rose in the wholesale trade and food services and drinking places sectors during this 

period. (See table 2.) 

Measures for industries in other sectors have been published in separate releases 

and can be accessed online at: http://www.bls.gov/schedule/archives/prin_nr.htm. 
2005-2006 change 

Wholesale trade: Output per hour grew 4.3 percent, as output increased 6.6 

percent and hours advanced 2.2 percent. Labor productivity rose 5.1 percent in durable 

merchant wholesalers (NAICS 423) and increased 2.7 percent in nondurable merchant 

wholesalers (NAICS 424). Labor productivity rose in 15 of the 19 detailed wholesale 

trade industries in 2006, as output grew in 17 industries while hours fell in four. The 

largest increases in productivity—13.0 percent and 11.8 percent—occurred in motor 

vehicles and parts wholesalers (NAICS 4231), and farm product raw materials 

wholesalers (NAICS 4245), respectively. Unit labor costs declined in seven of the 19 

detailed industries, but grew 0.5 percent in wholesale trade overall.

 Retail trade: Output per hour increased 4.9 percent as output grew 4.1 percent 

while hours declined 0.8 percent. Labor productivity rose in 24 of the 27 detailed retail 

trade industries in 2006. Output increased in 20 industries, while hours declined in 16 

industries. Specialty food stores (NAICS 4452) and electronic shopping and mail-order 

houses (NAICS 4541) had the largest productivity increases—20 percent and 18.2 

percent, respectively. Productivity also grew in each of the six largest retail trade 

industries, those with more than one million employees. Unit labor costs fell 1.5 percent 

in the retail trade sector and declined in 18 of the 27 industries studied; the largest 

decline, 12.2 percent, occurred in specialty food stores (NAICS 4452). 

Food services and drinking places: Output per hour rose 2.4 percent as output 

and hours grew 4.9 percent and 2.4 percent, respectively. Three of the four industries in 

food services and drinking places registered productivity gains in 2006. Output and 

hours grew in each of the food services industries, but fell in drinking places (NAICS 

7224). The largest increase in productivity, 3.2 percent, occurred in limited-service eating 

places (NAICS 7222), while output per hour in special food services (NAICS 7223), 

declined 2.4 percent. Unit labor costs rose in each of the detailed industries and grew 2.1 

percent in food services and drinking places overall. 

Chart 1. Percent change in output per hour, output, and hours, 2005-2006

(Wholesale Trade, Retail Trade, and Food Services and Drinking Places)

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

Output

per Hour

Output Hours Output

per Hour

Output Hours Output

per Hour

Output Hours

Wholesale Trade Retail Trade Food Services and Drinking

Places

% Change 

2
Long-term trends 

Wholesale trade: Output per hour increased 3.5 percent per year, on average, 

between 1987 and 2006. Output grew 4.2 percent per year and hours rose 0.7 percent per 

year. At the subsector level, productivity advanced 5.6 percent per year in durable 

merchant wholesale trade (NAICS 423), and increased 1.3 percent per year, on average, 

in nondurable merchant wholesale trade (NAICS 424). Labor productivity increased in 

17 of the 19 detailed industries. Commercial equipment wholesalers (NAICS 4234) and 

electric goods wholesalers (NAICS 4236), had the largest average annual increases in 

labor productivity of 15.6 percent and 9.1 percent per year, respectively. Output grew in 

all but one industry, while hours decreased in six industries. Unit labor costs increased in 

all but three of the wholesale trade industries over the period, and rose 0.7 percent per 

year overall in the wholesale trade sector. 

 Retail trade: Output per hour rose an average 3.4 percent per year from 1987 to 

2006, as output increased 4.2 percent per year and hours grew 0.8 percent. Output per 

hour increased in all 27 detailed industries. Labor productivity rose fastest in electronics 

and appliance stores (NAICS 443), at an average annual rate of 13.4 percent per year, 

followed by electronic shopping and mail-order houses (NAICS 4541), which recorded 

growth in output per hour of 12.0 percent per year. Output increased in 26 of the 27 retail 

trade industries and hours grew in 18 industries. Unit labor cost fell in 15 of the 27 

industries in this sector between 1987 and 2006 and declined 0.2 percent per year in retail 

trade overall. 

Food services and drinking places: Output per hour increased at an average 

annual rate of 0.8 percent per year as output and hours grew 2.5 percent per year and 1.7 

percent per year, respectively. The three food services industries all recorded growth in 

labor productivity, output, and hours from 1987-2006. During this same period, both 

output and productivity in drinking places (NAICS 7224) declined 0.5 percent per year 

while hours were unchanged. Unit labor costs increased in each of the detailed industries 

and rose 3.0 percent per year in food services and drinking places overall. 

Chart 2. Average annual percent change in output per hour, output, and hours, 1987-2006

(Wholesale Trade, Retail Trade, and Food Services and Drinking Places)

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

Output

per Hour

Output Hours Output

per Hour

Output Hours Output

per Hour

Output Hours

Wholesale Trade Retail Trade Food Services and Drinking

Places

% Change 

3
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. Industry output measures for 

the trade and food services and drinking places industries are constructed by deflating 

nominal dollar revenues from the Bureau of the Census, U.S. Department of Commerce, 

with price indexes primarily from BLS. 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. 

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 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 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 by 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 the trade and food services and 

drinking places industries. The hours of nonsupervisory workers, supervisory workers, 

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

directly aggregated. 

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 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 service inputs, including contract 

employment services; the organization of production; managerial skill; and the 

characteristics and effort of the workforce. 

4
Long-term trends tend to be more reliable indicators of the performance of an 

industry than are 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. 

Notes 

The measures in this news release incorporate revised data from the Census 

Bureau’s Current Business Reports (March 2007) and Monthly Wholesale Trade Survey 

(August 2007); also included are BLS employment and hours from the annual 

benchmark revision of the Current Employment Statistics (CES) survey (February 2007) 

and wages from the Quarterly Census of Employment and Wages (July 2007). Output 

measures for the wholesale trade industries in this release incorporate revisions to the 

weights used to combine detailed commodity price indexes for deflating the sales of 

manufacturers’ sales branches and offices (MSBOs). The weights now reflect improved 

estimates of the individual product line sales by MSBOs. The measures replace the 

wholesale trade, retail trade, and food services and drinking places series published in the 

news release Productivity and Costs by Industry: Wholesale Trade, Retail Trade, and 

Food Services and Drinking Places, 2005 (released August 22, 2006) and in table 50 of 

the Monthly Labor Review, and may reflect revisions to those series. All of the measures 

for 2006 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. 

Additional related measures for selected detailed industries, including industry 

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

5
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. 

6
Table 1. Percent change in output per hour, output, hours, compensation, and unit labor costs, 2005-2006

2006 Percent change, 2005-2006

NAICS Industry Employment Output Labor Unit labor

code (thousands) per hour Output Hours compensation costs

Wholesale Trade

42 Wholesale trade 6118 4.3 6.6 2.2 7.2 0.5

423 Durable goods 3185 5.1 8.3 3.0 7.0 -1.2

4231 Motor vehicles and parts 365 13.0 12.7 -0.2 3.1 -8.5

4232 Furniture and furnishings 123 7.4 8.7 1.2 5.8 -2.7

4233 Lumber and construction supplies 274 -2.5 2.8 5.5 8.3 5.3

4234 Commercial equipment 667 10.0 14.0 3.6 6.8 -6.3

4235 Metals and minerals 128 -3.1 1.0 4.2 5.4 4.4

4236 Electric goods 351 10.6 9.5 -0.9 8.0 -1.4

4237 Hardware and plumbing 260 0.9 5.6 4.7 6.9 1.2

4238 Machinery and supplies 694 3.8 6.1 2.2 7.7 1.6

4239 Miscellaneous durable goods 324 -10.2 -2.6 8.5 9.1 11.9

424 Nondurable goods 2143 2.7 4.3 1.5 5.4 1.0

4241 Paper and paper products 161 -1.3 0.9 2.2 4.6 3.6

4242 Druggists' goods 217 6.7 9.2 2.4 3.9 -4.9

4243 Apparel and piece goods 166 6.8 8.5 1.6 8.5 0.0

4244 Grocery and related products 747 0.7 3.6 2.8 6.5 2.8

4245 Farm product raw materials 77 11.8 6.3 -4.9 0.5 -5.4

4246 Chemicals 137 1.3 -0.8 -2.1 5.5 6.3

4247 Petroleum 103 3.4 3.4 0.0 10.1 6.5

4248 Alcoholic beverages 155 2.6 5.1 2.4 6.7 1.5

4249 Miscellaneous nondurable goods 382 2.0 3.1 1.1 1.8 -1.3

425 Electronic markets and agents and brokers 790 7.2 8.2 0.9 12.3 3.8

Retail Trade

44-45 Retail trade 16389 4.9 4.1 -0.8 2.5 -1.5

441 Motor vehicle and parts dealers 2002 2.2 0.5 -1.6 1.6 1.1

4411 Automobile dealers 1306 2.4 1.1 -1.3 1.8 0.7

4412 Other motor vehicle dealers 181 0.8 -3.5 -4.3 -1.1 2.5

4413 Auto parts, accessories, and tire stores 516 -0.1 -1.7 -1.6 2.1 3.9

442 Furniture and home furnishings stores 650 7.4 8.0 0.6 4.3 -3.4

4421 Furniture stores 322 8.4 5.6 -2.6 3.4 -2.0

4422 Home furnishings stores 328 6.6 10.9 4.0 5.3 -5.0

443 Electronics and appliance stores 571 12.6 17.0 3.9 4.2 -11.0

444 Building material and garden supply stores 1378 6.5 7.9 1.3 4.0 -3.6

4441 Building material and supplies dealers 1208 5.9 7.5 1.5 4.8 -2.5

4442 Lawn and garden equipment and supplies stores 169 10.7 10.9 0.2 -2.2 -11.9

445 Food and beverage stores 2933 3.2 2.8 -0.5 1.8 -0.9

4451 Grocery stores 2524 1.8 2.1 0.3 2.6 0.5

4452 Specialty food stores 255 20.0 10.1 -8.3 -3.4 -12.2

4453 Beer, wine and liquor stores 154 5.0 7.7 2.6 -0.4 -7.6

446 Health and personal care stores 987 4.9 4.1 -0.7 4.8 0.7

447 Gasoline stations 882 -2.3 -1.3 1.0 0.7 2.0

448 Clothing and clothing accessories stores 1537 10.5 6.2 -3.9 1.1 -4.7

4481 Clothing stores 1142 10.9 6.5 -4.0 -0.3 -6.4

4482 Shoe stores 185 12.3 5.9 -5.7 4.6 -1.3

4483 Jewelry, luggage, and leather goods stores 210 7.1 4.6 -2.3 3.9 -0.6

451 Sporting goods, hobby, book, and music stores 726 6.3 7.0 0.7 1.1 -5.5

4511 Sporting goods and musical instrument stores 520 11.8 12.2 0.4 2.7 -8.5

4512 Book, periodical, and music stores 207 -6.6 -5.4 1.3 -2.7 2.9
Table 1. Percent change in output per hour, output, hours, compensation, and unit labor costs, 2005-2006

2006 Percent change, 2005-2006

NAICS Industry Employment Output Labor Unit labor

code (thousands) per hour Output Hours compensation costs

452 General merchandise stores 2944 5.1 5.0 0.0 3.9 -1.1

4521 Department stores 1563 2.9 -0.5 -3.4 0.2 0.8

4529 Other general merchandise stores 1381 5.4 8.8 3.3 8.1 -0.7

453 Miscellaneous store retailers 1084 12.2 8.2 -3.6 0.7 -6.9

4531 Florists 119 3.9 -4.6 -8.2 -7.9 -3.4

4532 Office supplies, stationery and gift stores 421 14.7 10.3 -3.8 -0.6 -9.9

4533 Used merchandise stores 191 4.4 11.0 6.3 9.6 -1.3

4539 Other miscellaneous store retailers 353 14.5 7.6 -6.1 0.9 -6.3

454 Nonstore retailers 695 17.3 10.1 -6.2 0.8 -8.5

4541 Electronic shopping and mail-order houses 296 18.2 14.7 -2.9 2.8 -10.4

4542 Vending machine operators 66 5.4 -4.8 -9.6 1.9 7.0

4543 Direct selling establishments 333 11.6 1.9 -8.7 -1.8 -3.6

Food Services and Drinking Places 

722 Food services and drinking places 9656 2.4 4.9 2.4 7.2 2.1

7221 Full-service restaurants 4495 2.9 5.7 2.8 7.0 1.3

7222 Limited-service eating places 4082 3.2 5.4 2.1 6.6 1.1

7223 Special food services 700 -2.4 2.8 5.3 10.8 7.8

7224 Drinking places, alcoholic beverages 380 2.6 -2.3 -4.8 4.8 7.3
Table 2. Average annual percent change in output per hour, output, hours, compensation, and unit labor costs, 1987-2006

Average annual percent change, 1987-2006

NAICS Industry Output Labor Unit labor

code per hour Output Hours compensation costs

Wholesale Trade

42 Wholesale trade 3.5 4.2 0.7 5.0 0.7

423 Durable goods 5.6 6.2 0.5 5.1 -1.0

4231 Motor vehicles and parts 4.3 4.2 -0.1 4.3 0.1

4232 Furniture and furnishings 2.8 3.0 0.2 5.1 2.1

4233 Lumber and construction supplies 1.2 3.3 2.0 4.7 1.4

4234 Commercial equipment 15.6 16.4 0.6 5.3 -9.5

4235 Metals and minerals -0.1 0.4 0.5 4.9 4.5

4236 Electric goods 9.1 8.9 -0.2 5.2 -3.4

4237 Hardware and plumbing 1.3 2.8 1.4 5.4 2.5

4238 Machinery and supplies 2.7 2.8 0.1 4.8 1.9

4239 Miscellaneous durable goods 1.5 2.7 1.1 5.8 3.0

424 Nondurable goods 1.3 1.7 0.3 5.1 3.3

4241 Paper and paper products 2.5 2.0 -0.5 4.2 2.1

4242 Druggists' goods 2.8 5.3 2.4 10.7 5.1

4243 Apparel and piece goods 3.0 2.8 -0.2 4.5 1.7

4244 Grocery and related products 0.9 1.9 1.0 5.0 3.0

4245 Farm product raw materials 2.1 -0.6 -2.7 3.3 4.0

4246 Chemicals -0.1 0.8 0.9 4.9 4.1

4247 Petroleum 3.3 0.4 -2.9 3.1 2.7

4248 Alcoholic beverages 0.4 2.0 1.5 5.0 3.0

4249 Miscellaneous nondurable goods 0.7 0.8 0.1 3.6 2.9

425 Electronic markets and agents and brokers 2.0 4.7 2.6 4.6 -0.1

Retail Trade

44-45 Retail trade 3.4 4.2 0.8 4.0 -0.2

441 Motor vehicle and parts dealers 2.7 3.8 1.1 4.4 0.5

4411 Automobile dealers 2.5 3.7 1.2 4.5 0.7

4412 Other motor vehicle dealers 3.5 6.0 2.4 6.4 0.4

4413 Auto parts, accessories, and tire stores 2.5 3.0 0.5 3.3 0.3

442 Furniture and home furnishings stores 4.2 5.4 1.2 4.5 -0.8

4421 Furniture stores 3.7 4.6 0.9 4.1 -0.5

4422 Home furnishings stores 4.8 6.4 1.5 5.0 -1.2

443 Electronics and appliance stores 13.4 15.6 1.9 4.9 -9.2

444 Building material and garden supply stores 3.4 5.5 2.0 4.7 -0.8

4441 Building material and supplies dealers 3.3 5.7 2.3 5.0 -0.7

4442 Lawn and garden equipment and supplies stores 4.3 4.4 0.0 2.9 -1.4

445 Food and beverage stores 0.5 0.4 -0.1 3.3 2.8

4451 Grocery stores 0.4 0.4 0.0 3.5 3.0

4452 Specialty food stores 0.5 0.4 -0.2 2.3 2.0

4453 Beer, wine and liquor stores 2.5 0.9 -1.6 2.4 1.5

446 Health and personal care stores 2.7 3.9 1.2 5.2 1.2

447 Gasoline stations 2.0 1.5 -0.4 2.5 1.0

448 Clothing and clothing accessories stores 4.9 5.0 0.1 3.3 -1.6

4481 Clothing stores 5.0 5.5 0.5 3.6 -1.8

4482 Shoe stores 4.4 3.0 -1.4 1.9 -1.1

4483 Jewelry, luggage, and leather goods stores 4.5 4.8 0.3 3.4 -1.4

451 Sporting goods, hobby, book, and music stores 4.6 5.1 0.5 4.1 -0.9

4511 Sporting goods and musical instrument stores 5.5 5.9 0.4 4.2 -1.6

4512 Book, periodical, and music stores 2.4 3.2 0.8 3.8 0.6
Table 2. Average annual percent change in output per hour, output, hours, compensation, and unit labor costs, 1987-2006

Average annual percent change, 1987-2006

NAICS Industry Output Labor Unit labor

code per hour Output Hours compensation costs

452 General merchandise stores 3.9 5.6 1.6 4.1 -1.4

4521 Department stores 1.4 2.5 1.1 3.0 0.5

4529 Other general merchandise stores 7.3 9.6 2.1 5.6 -3.6

453 Miscellaneous store retailers 4.8 5.2 0.4 3.0 -2.1

4531 Florists 2.6 0.2 -2.3 0.6 0.4

4532 Office supplies, stationery and gift stores 6.8 7.1 0.2 3.5 -3.4

4533 Used merchandise stores 5.1 6.5 1.3 4.4 -2.0

4539 Other miscellaneous store retailers 2.9 4.4 1.4 2.7 -1.6

454 Nonstore retailers 8.9 9.3 0.4 3.8 -5.1

4541 Electronic shopping and mail-order houses 12.0 16.0 3.6 7.8 -7.1

4542 Vending machine operators 0.8 -1.5 -2.3 1.4 3.0

4543 Direct selling establishments 3.5 2.4 -1.1 1.6 -0.8

Food Services and Drinking Places 

722 Food services and drinking places 0.8 2.5 1.7 5.6 3.0

7221 Full-service restaurants 0.9 2.7 1.8 6.6 3.8

7222 Limited-service eating places 0.8 2.7 2.0 5.4 2.6

7223 Special food services 1.4 2.5 1.1 3.8 1.3

7224 Drinking places, alcoholic beverages -0.5 -0.5 0.0 2.4 2.9