Monthly Labor Review • September 2008 

Business Ownership Change

Dina Itkin is an 

economist in the 

Office of Employment 

and Unemployment 

Statistics, Bureau of 

Labor Statistics. E-mail: 

itkin.dina@bls.gov

Dina Itkin

The effect of business ownership change 

on occupational employment and wages

Every year, thousands of U.S. businesses are bought, sold, or merged to raise profits, reduce costs, increase 

market share, or otherwise interact in the 

dynamic economy. The national level of 

business ownership change peaked in the 

late 1990s, when the Nation was experiencing rapid economic growth, and declined 

gradually through 2002.1 After 2003, the 

number and asset trade value of ownership 

changes rose steadily again. Volume in 2006 

exceeded that in 2005 by 38 percent and 

surpassed a 2000 record. The year-over-year 

asset trade volume of ownership change as 

of July 2007 was up 60 percent globally and 

41 percent in the United States.2

Existing literature and anecdotal evidence 

have found varying effects of ownership 

changes on company profits, labor productivity, wages, and staffing in specific industries. For example, research using Census 

Bureau data on manufacturing companies 

found that ownership changes led to reductions in employment and wages at auxiliary 

(support) offices, but had little effect on employment at production plants.3

 Two other 

studies—one of manufacturing firms4 and the 

other of food-manufacturing firms5—found 

that ownership changes resulted in employment and wage increases overall, but led to 

job losses in large firms.

An analysis of business establishment microdata reveals that, 

after a business changes ownership, employment falls, 

but wages rise, in occupations that performed analytical, 

clerical, and production work; by contrast, employment levels 

are maintained, but wages fall, in service occupations

Trends in personnel changes in all sectors 

of the economy are of interest to economists, 

business owners, and workers, but there is 

little, if any, recent empirical research on the 

effects of ownership changes on detailed occupational employment. Such information 

provides insight into the specific jobs and 

skill sets that are in demand when firms reorganize or redirect their business strategies.

This study uses a recent large sample 

of business establishment microdata to 

examine how overall employment and occupational composition are affected when 

establishments undergo a change in ownership. The study resulted in a number of interesting findings: after ownership changes, 

(1) employment levels of occupations that 

performed analytical, clerical, and production work were least likely to be maintained, 

and most of these groups’ wages shifted toward higher ranges; (2) employment levels 

of service occupations such as health care, 

education, and protection services were 

more likely to be maintained, but most of 

these groups’ wages shifted toward lower 

ranges, on average; (3) overall, employment 

declines were seen in establishments that 

changed ownership; and (4) among the industries that contracted the most, declines 

were concentrated in occupations that serve 

a support function in the industry, rather 
Business Ownership Change

 Monthly Labor Review • September 2008

than in occupations that are core to the industry’s output. 

These findings tended to be supported across establishments of different sizes, with decreases in the share of 

support occupations such as office and administrative 

support, management, and sales occupations in all size 

classes.

Methodology

This study was conducted with the use of microdata 

from the Occupational Employment Statistics (OES) 

survey. The OES program surveys approximately 200,000 

establishments every 6 months, taking 3 years to collect 

its full sample of 1.2 million establishments. Establishments are eligible for selection again after 3 years. The 

data set consisted of all business establishments that reported to the OES survey twice over a period of 6 years. 

Those establishments were put into two subsamples on 

the basis of whether or not they changed ownership, as 

defined by a change in the Unemployment Insurance 

(UI) account number. Included in the study were microdata from all 50 States and the District of Columbia, 

from establishments that reported occupational employment for all of their employees and wage data for most 

of their employees.6

All establishments covered by State Unemployment 

Insurance have an assigned UI account number. When 

a firm changes ownership, it normally refiles with the 

Unemployment Insurance program and receives a new 

UI number. By contrast, the Quarterly Census of Employment and Wages (QCEW) program’s Longitudinal 

Database (LDB) assigns each establishment a unique 

LDB number that does not change, even if the ownership 

changes. A total of 277,027 establishments reported to 

the OES survey exactly twice during a 6-year period from 

2000 to 2006.7 Of the establishments that reported twice 

with the same LDB number, 254,829 had the same UI

number the second time they reported. These establishments serve as this study’s subsample of establishments 

that did not change ownership (the control subsample). 

The remaining 22,198 establishments had different UI

numbers the second time they reported and serve as the 

study’s subsample of establishments that changed ownership (the ownership change subsample). Each establishment in either subsample has longitudinal occupational 

staffing data for two points in time. The first reports are 

included in the predecessor group, whose establishments 

reported data between 2000 and 2003.The second reports 

are included in the successor group, whose establishments 

reported data between 2003 and 2006. 

Limitations of the study

Elements of the OES sampling strategy may create a bias 

toward larger establishments in the study’s subsamples. 

The reason is that sample selection within geographic area 

and industry group strata is approximately proportional to 

size, in order to provide the most occupational coverage. 

Although there are more small units in the subsamples, 

larger units are more likely to be selected at two points in 

time and included in the subsamples. This bias is enhanced 

by the fact that the study uses unweighted employment.

Although a change in UI account number in establishments with the same LDB number represents an ownership change most of the time, limitations to this definition 

exist. A change in UI number does not necessarily indicate 

a change in ownership (it could be the result of a change 

in the type of business entity, as, for example, when a business incorporates), and perhaps not all ownership changes 

were marked by a UI number change. To facilitate the 

identification of establishments that changed ownership, 

factors such as employment, trade names, physical addresses, and telephone numbers were used in determining 

whether to maintain the LDB number.

The microdata do not differentiate among types of ownership changes, such as mergers, takeovers, divestitures, or 

buyouts. If the ownership change represents a merger or 

an acquisition, then changes in the acquiring establishment 

are not measured; only employment data from the acquired 

establishment are captured in this study. For example, if an 

establishment was bought by another company, the study 

would capture predecessor and successor data only for the 

establishment with the same LDB number before and after 

the purchase. A related limitation of the study is that the 

data do not indicate whether labor was voluntarily or involuntarily removed, or whether it was contracted out or 

outsourced, after the ownership change. Also, because the 

time between the first and second reporting is at least 3 

years for all establishments, the study might not capture 

staffing changes that occurred immediately before or after 

the ownership change. In some cases, the transition might 

be only partially complete at the second reporting; in other 

cases, the transition may already have begun at the first reporting, in anticipation of a future takeover.

Overall employment trends

Certain industries were more likely to change ownership 

relative to other industries in the study subsample and to the 

economy as a whole. Table 1 shows, in order by column, the 

industry distributions of establishments that reported twice, 
Monthly Labor Review • September 2008 

the industry distributions of establishments that changed 

ownership, and the percentage of establishments that 

changed ownership in each industry. The industries listed 

are sorted by the percent that changed ownership. Industries 

in which at least 10 percent of establishments changed ownership were information, accommodation and food services, 

and administrative and support and waste management and 

remediation services. The two columns headed “Percent distribution...” serve as an indication of industry distribution in 

the ownership change subsample relative to the industry’s 

representation in the economy. Industries that represented 

a large proportion of the ownership change subsample 

relative to the economy as a whole included manufacturing, 

retail trade, information, health care and social assistance, 

transportation and warehousing, and accommodation and 

food services. At the more detailed industry level, the OES

data are consistent with other findings8 which show that, 

in 2003, most ownership changes were in business services, 

prepackaged software, commercial banks and bank holding 

companies, real estate, mortgage bankers and brokers, and 

oil and gas and petroleum refining.

Overall, there was a decline in total employment from 

the predecessor group to the successor group after ownership changes. Total employment in the predecessor group 

was 2,018,250, and total employment in the successor 

group was 1,890,986, a decrease of more than 6.31 percent.9

 This employment decrease occurred despite overall 

private-sector employment growth of 2.82 percent between 

2002 and 2005.10 Almost half (10,677) of the 22,198 establishments that changed ownership experienced a decrease 

in employment, 9,517 saw an increase in employment, and 

the remaining 2,004 had no change in employment. Although employment decreased overall in the ownership 

change subsample, employment change varied by industry, 

establishment size, and occupation.

The distribution of the ownership change subsample 

and the control subsample is shown by establishment size 

in table 2. In the control subsample, there was an aggregate 

shift toward medium and large sizes, while in establishments that changed ownership, there was an aggregate shift 

toward smaller sizes. After establishments changed ownership, the concentration of establishments increased in the 

1-to-9-employee and 10-to-49-employee size classes and 

decreased in the three larger size classes. The concentration 

in the 1-to-9-employee size class grew by nearly 5 percent in the ownership change subsample, while it grew by 

 Concentration of establishments, by industry sector, in the ownership change subsample and across all 

 establishments, 2000–06

 Table 1.

Industry sector

Number of

units that

reported

twice

 Total.................................................................... 277,027 122,198 8.01 1100 18,294,662 100

Information................................................................ 6,858 793 11.56 3.57 141,

Accommodation and food services.................. 15,283 1,760 11.52 7.93 572,7

Administrative and support and waste

 management and remediation services.... 13,436 1,351 10.06 6.09 426

Retail trade................................................................. 41,261 3,875 9.39 17.46 1,

Manufacturing.......................................................... 40,480 3,469 8.57 15

Finance and insurance........................................... 10,713 915 8.54 4.12

Health care and social assistance ...................... 26,317 2,226 8.46 10.03 689,010

Wholesale trade....................................................... 18,742 1,516 8.09 6.83 601,6

Transportation and warehousing...................... 10,221 814 7.96 3.67 212,30

Real estate and rental and leasing.................... 7,632 576 7.55 2.59

Mining ......................................................................... 1,618 122 7.54 .55 

Management of companies and enterprises 2,176 162 7.44 .73 4

Professional and technical services.................. 16,163 1,126 6.97 5.07 902,710 1

Utilities........................................................................ 1,754 121 6.90 .55 16,2

Arts, entertainment, and recreation................. 6,465 418 6.47 1.88 118

Other services, except public administration..... 18,805 1,204 6.40 5.42 1,1

Construction ............................................................. 21,357 1,316 6.16 5.93 8

Educational services............................................... 11,396 273 2.40 1.23 78

1 Details do not sum to total because some industries are not listed 

separately and some establishments lack an industry classification. The 

industry sector of agriculture, forestry, fishing, and hunting is excluded 

Number of

units that

changed

ownership

Percent 

that

changed

ownership

Percent

distribution

of

ownership

change

subsample

Average

number of

privatesector

establishments

in 2005,

QCEW

Percent

distribution of

private sector

establishments

in 2005,

QCEW

because the OES and QCEW have incomplete coverage of that sector. OESdesignated government industries also are excluded.
Business Ownership Change

  Monthly Labor Review • September 20

 Concentration of establishments in the OES sample, by size, in the ownership change subsample and the 

 control subsample, 2000–06

 Table 2.

Size of establishment Number of

predecessor 

units 

 Total................................................. 22,198 22,198 ... ... 254,829 254,829

1–9 employees..................................... 5,277 5,530 253 4.79 69,585 70

10–49 employees................................ 9,094 9,151 57 .63 108,834 107

 50–249 employees............................. 6,199 5,973 –226 –3.65 60,024 

250–999 employees........................... 1,412 1,335 –77 –5.45 14,057

1,000 or more employees................ 216 209 –7 –3.24 2,329 2,3

Number of

successor

units

Difference

between

number of

predecessor

and

successor

units

Number of

predecessor

units

Difference

between

number of

predecessor

and

successor

units

Ownership change subsample

Percent

change

Number of

successor

units

Percent

change

Control subsample

substantially less in the control subsample. Likewise, the 

number of 10-to-49-employee establishments increased 

in the ownership change subsample, while it decreased 

in the control subsample. These shifts suggest that, after 

ownership changes, the size distribution of establishments moved toward smaller establishments; that is, more 

establishments shrank than grew. Because these numbers 

capture only overall total concentrations at two different 

times, the last section of this article examines employment 

changes by establishment size.

Changes by occupational group

Changes in employment levels. After ownership changes, 

changes in employment were spread across several occupations, with more than half of the occupational groups seeing declines in employment and other occupational groups 

seeing employment increases. Table 3 presents the changes 

in employment in each occupational group after ownership 

changed. As shown in the column headed “Employment 

difference,” the occupations that decreased in employment 

level were production; office and administrative support; 

sales and related; management; computer and mathematical science; business and financial operations; architecture 

and engineering; transportation and material moving; 

building and grounds cleaning and maintenance; personal 

care and service; installation, maintenance, and repair; arts, 

design, entertainment, sports, and media; construction and 

extraction; and legal occupations.

At the other end of the spectrum, the occupational 

groups that grew after ownership changes were health care 

practitioner and technical; protective service; health care 

support; education, training, and library; food preparation and serving; community and social services; and life, 

physical, and social science occupations. Because changes 

in level do not convey growth or decline relative to other 

occupational groups, an analysis of the employment shares 

of total predecessor and successor employment follows.

Relative changes in employment shares. Table 3 also shows 

the percentage-point difference between the predecessor 

and successor employment shares in both subsamples. Occupational groups are labeled “less likely” or “more likely” 

to be retained, on the basis of their change in employment 

share in the ownership change subsample relative to the 

control subsample. Employees who were less likely to be 

retained are in occupations whose employment shares (1) 

shrank in the ownership change subsample while they 

grew in the control subsample, (2) grew in the ownership 

change subsample by less than they grew in the control 

subsample, or (3) shrank in the ownership change subsample by more than they shrank in the control subsample. This set of occupations (those which are less likely 

to be retained) is plotted to the right of the diagonal in 

chart 1. For each occupational group shown in the chart, 

the further the point that is associated with it lies from 

the origin and the diagonal, the greater is the difference 

between the employment shares in establishments that 

changed ownership and in establishments that did not 

change ownership.

Employees who performed analytical, clerical, and production work were less likely to be retained after ownership changes. The occupational groups that shrank in 

the ownership change subsample while they grew in the 

control subsample (occupational groups located in quadrant IV) were computer and mathematical science; busi-
Monthly Labor Review • September 2008

 Occupational employment level and difference in share in the ownership change subsample and the control

 subsample, 2000–06

 Table 3.

Occupational Group

Ownership

change

subsample1

Control

subsample

Predecessor

employment

Percentage-point

difference between

predecessor

and successor

employment share

Successor

employment

Employment

difference

Ownership change subsample

Predecessor

employment

share 

(percent)

Control subsample

Predecessor

employment

Successor

employment

Employment

difference

Predecessor

employment

share 

(percent)

Successor

employment

share 

(percent)

Successor

employment

share 

(percent)

 Occupational groups

less likely to be retained

Computer and 

 mathematical science ... –0.72 0.14 67,063 49,262 –17,801 3.32 2.61 432,022 47

Business and financial 

 operations......................... –.28 .39 74,172 64,278 –9,894 3.68 3.40 635,571 73

Arts, design, entertain-

 ment, sports, and media.. –.03 .07 19,136 17,435 –1,701 .95 .92 216,138 235,38

Legal ..................................... –.01 .01 4,818 4,293 -525 .24 .23 86,609

Production............................ –1.05 –.54 320,946 280,789 –40,157 15.90 14.85 2,217,795 2,149,98

Management....................... –.86 –.52 94,876 72,694 –22,182 4.70 3.84 980,344 888

Sales and related................ –.58 –.29 199,818 176,232 –23,586 9.90 9.32 1,794,334 1,771,712 –22,62

Office and administrative 

 support............................... –.48 –.28 321,625 292,198 –29,427 15.94 15.45 3,336,426 3,34

Architecture and 

 engineering....................... –.21 –.06 48,962 41,897 –7,065 2.43 2.22 404,330 400,9

Life, physical, and social 

 science ................................ .05 .08 10,939 11,263 324 .54 .60 176,926 198,318

 Occupational groups 

 more likely to be retained

Food preparation and 

 serving related................. .53 –.03 113,913 116,778 2,865 5.64 6.18 1,069,685 1,086

Transportation and 

 material moving.............. .23 –.11 173,556 166,968 –6,588 8.60 8.83 1,670,394 1,684,016 13,

Installation, maintenance,

 and repair.......................... .09 –.06 82,013 78,499 –3,514 4.06 4.15 798,334

Building and grounds 

 cleaning and 

 maintenance..................... .01 –.04 65,291 61,425 –3,866 3.24 3.25 772,076 780,

Protective service............... .87 .11 68,638 80,719 12,081 3.40 4.27 551,749 587,62

Health care support.......... .77 .17 66,298 76,718 10,420 3.28 4.06 577,304 626,014 4

Health care practitioner 

 and technical.................... 1.02 .45 106,778 119,360 12,582 5.29 6.31 1,306,749 1,432,698 12

Education, training, and 

 library .................................. .40 .29 42,235 47,190 4,955 2.09 2.50 2,262,029 2,375,172 

Community and social 

 services............................... .10 .03 17,429 18,266 837 .86 .97 307,033 321,000 1

Construction and 

 extraction........................... .11 .09 58,491 56,922 –1,569 2.90 3.01 858,143 896,

 

 Groups with a change 

of less than 0.01 in either 

 subsample

Personal care and 

 service................................. (

2

) .11 55,579 52,035 –3,544 2.75 2.75 607,19

Farming, fishing, and 

 forestry................................ .02 () 5,674 5,765 91 .28 .30 90,503 

3 Slight positive difference. 1 Numbers are affected by rounding. 2 Slight negative differences
Business Ownership Change

  Monthly Labor Review • September 20

ness and financial operations; arts, design, entertainment, 

sports, and media; and legal occupations. The following 

occupational groups shrank by more in the ownership 

change subsample than they shrank in the control subsample (occupational groups located to the right of the 

diagonal in quadrant III): production, management, sales 

and related, office and administrative support, and architecture and engineering occupations. Life, physical, and 

social science occupations grew in the ownership change 

subsample, but by less than they grew in the control subsample (the occupational group located to the right of the 

diagonal in quadrant I).

By contrast, employees who were more likely to be 

retained were in occupations that (1) grew in the ownership change subsample while they shrank in the control 

subsample or (2) grew in the ownership change subsample by more than they grew in the control subsample. 

(None shrank in the ownership change subsample by 

less than they shrank in the control subsample.) The set 

of occupations in which employees were more likely to 

be retained is plotted to the left of the diagonal in the 

chart. 

Service-related jobs, such as health care, education, and 

protection, were the most likely to be retained after ownership changes. The occupational groups that grew in the 

ownership change subsample while they shrank in the control subsample (those occupations located in quadrant II) 

were food preparation and serving related; transportation 

and material moving; installation, maintenance, and repair; 

and building and grounds cleaning and maintenance occupations. Occupational groups that grew by more in the 

ownership change subsample than in the control subsample 

(those located to the left of the diagonal in quadrant I) included protective service; health care support; health care 

practitioner and technical; education, training, and library; 

community and social services; and construction and extraction occupations. The types of jobs that were less likely 

or more likely to be retained after ownership changes varied by industry, as the next section details.

Changes within occupational groups

Examining detailed changes within occupational groups 

helps uncover trends among different business functions, 

such as human resources, marketing, and sales. The occupations discussed in this section and listed in table 4 

 Chart 1. The effect of business ownership change on different types of occupations, 2000–06: percentagepoint difference between predecessor and successor employment shares Ownership

 change

subsample

1.

1

0.

0

–0.

–1

–1.

More likely to be retained

Less likely to be retained

Health care support

Protective service

1.

1

0.

0

–0.

–1

–1.

1.5  –1 –0.5 0 0

Quadrant III Quadrant IV

Legal

Quadrant II Quadrant I

Farming, fishing,

 and forestry Office and administrative support

 Architecture

and engineering

Sales and related

 Computer and mathematical science

 Education, training, and library

Health care practitioner

 and technical

Food preparation and serving related

Personal care

 and service

Production

Building and grounds cleaning

 and maintenance

Arts, design, entertainment, sports, and media

Transportation and material moving

Installation, maintenance, and repair Life, physical, and social science

Construction and extraction

Community and social services 

 Business and financial operations

Management

Control subsample

Ownership

 change

subsample
Monthly Labor Review • September 2008

 Difference between predecessor and successor occupational employment level and share in the ownership change 

 subsample, by detailed occupation, 2000–06

 Table 4.

Occupation

Predecessor

employment

level

Chief executives.............................................................................. 4,000 2,514 0.2 0.13 –0.

Marketing managers..................................................................... 3,802 2,286 .19 .12 –.07 –

Compensation and benefits managers.................................. 534 783 .03

 Business and financial operations occupations

Claims adjusters, examiners, and investigators................... 1,973 1,249 .10 .07 –.03

Compliance officers, except agriculture, construction, 

 health and safety, and transportation ............................... 1,172 1,660 .06 .09 .03 51

Logisticians....................................................................................... 698 1,536 .03 .08 .0

Management analysts.................................................................. 10,323 6,430 .51 .3

Financial analysts............................................................................ 5,110 3,170 .25 .17 –.0

 Computer and mathematical science occupations

Computer programmers.............................................................. 9,777 4,261 .48 .23 –.2

Computer systems analysts........................................................ 14,673 9,258 .73 .49 

Network systems and data communications analysts...... 2,149 4,562 .11 .24 .

Operations research analysts..................................................... 2,603 1,418 .13 .08 –0.0

 Architecture and engineering occupations

Aerospace engineers..................................................................... 1,518 932 .08 .05 –

Electrical and electronics drafters............................................ 864 1,143 .04 .06 

Mechanical engineering technicians...................................... 1,441 873 .07 .05 –

 Community and social services occupations

Child, family, and school social workers................................. 1,574 2,309 .08 .12 

 Education, training, and library occupations

Middle school teachers, except special and vocational 

 education ..................................................................................... 2,456 3,440 .12 .18 

Special education teachers, middle school .......................... 575 732 .03 .

Special education teachers, secondary school.................... 688 1,076 .03 .06 .02 66.

Teacher assistants........................................................................... 5,092 8,839 .25 .47 .2

 Arts, design, entertainment, sports, and media 

 occupations

Graphic designers.......................................................................... 1,609 1,968 .08 .10 .02 30.

Merchandise displayers and window trimmers.................. 867 1,081 .04 .06 .01 

Coaches and scouts....................................................................... 530 719 .03 .0

Radio and television announcers............................................. 522 1,019 .03 .05 .0

Reporters and correspondents................................................. 593 1,113 .03 .0

Technical writers............................................................................. 972 633 .05 .03 –.

 Health care practitioner and technical occupations

Physician assistants....................................................................... 1,716 669 .09 .04 –.05

Respiratory therapists................................................................... 1,676 2,391 .08 .13 .04

Diagnostic medical sonographers........................................... 663 852 .03 .05 

Radiologic technologists and technicians............................ 2,943 3,901 .15 .21 

Psychiatric technicians................................................................. 646 1,377 .03 .07 .04

Surgical technologists.................................................................. 1,557 2,016 .08 .11 .03 

Medical records and health information technicians....... 2,568 3,259 .13 .1

 Health care support occupations

Home health aides......................................................................... 15,642 21,588 .78 1.14 

Medical assistants.......................................................................... 3,033 3,916 .15 .21

Medical equipment preparers................................................... 641 1,190 .03 .06 .03 

 Protective service occupations

Private detectives and investigators....................................... 742 1,306 .04 .07 .03

 Personal care and service occupations

Nonfarm animal caretakers........................................................ 516 1,231 .03 .07 

Residential advisors....................................................................... 565 828 .03 .

 Sales and related occupations

Securities, commodities, and financial services sales 

 agents............................................................................................ 3,039 1,943 .15 0.1

Travel agents.................................................................................... 663 826 .03 .04 

Successor

employment

level

Predecessor

employment

share

Successor

employment

share

Difference

in share1

Percent

change in

share1

See footnote at end of table.
Business Ownership Change

10 Monthly Labor Review • September 2008

are the 70 occupations with substantial growth or decline11 after the ownership changes and with employment 

of at least 500 in the predecessor and successor groups. 

The table shows each occupation’s employment level and 

employment share in the ownership change subsample’s 

predecessor group and successor group, and the difference 

between them. The occupations are categorized by occupational group. Residual (“all other”) occupations are not 

shown.

Changes in employment levels. Occupations with the 

greatest decline in employment level (by more than 1,500 

employees) across all occupational groups in the ownership 

change subsample were computer programmers, computer 

systems analysts, four “assembly” production occupations, 

management analysts, transit and intercity bus drivers, 

financial analysts, demonstrators and product promoters, 

and marketing managers. Occupations that exhibited the 

greatest growth in employment level (by more than 1,500 

 Continued—Difference between predecessor and successor occupational employment level and share

 in the ownership change subsample, by detailed occupation, 2000–06

 Table 4.

Occupation

Predecessor

employment

level

 Office and administrative support occupations

Payroll and timekeeping clerks................................................. 3,241 4,104 .16 .22

Credit authorizers, checkers, and clerks................................. 1,855 979 .09 .05 –

Interviewers, except eligibility and loan................................ 2,987 3,761 .15 .20 

Meter readers, utilities.................................................................. 639 839 .03 .04 .

Legal secretaries............................................................................. 1,758 1,117 .09 .06 –.03 –

Medical secretaries........................................................................ 3,331 5,994 .17 .3

Insurance claims and policy processing clerks.................... 1,631 2,621 .08 .14 .06 

Office machine operators, except computer ....................... 1,825 1,135 .09 .06 –

Farming, fishing, and forestry oc

Farmworkers, farm and ranch animals................................... 550 1,025 .03 

 Construction and extraction occupations

Helpers—pipelayers, plumbers, pipefitters, and 

 steamfitters.................................................................................. 1,294 788 .06 .04 –.02

 Installation, maintenance, and repair occupations

Control and valve installers and repairers, except 

 mechanical door........................................................................ 729 903 .04 .05 

Telecommunications line installers and repairers.............. 2,791 3,477 .14 .18 .

Coin, vending, and amusement machine servicers 

 and repairers............................................................................... 605 885 .03 .05

 Production occupations

Aircraft structure, surfaces, rigging, and systems 

 assemblers................................................................................... 1,737  508 .09 .03 –.06 –

Electrical and electronic equipment assemblers................ 10,291 5,960 .51 .32 –.19 –

Engine and other machine assemblers.................................. 2,275 1,219 .11 .06 –.05 –

Slaughterers and meatpackers.................................................. 10,402 5,007 .52 .26 –.25

Forging machine setters, operators, and tenders, 

 metal and plastic ....................................................................... 1,831 696 .09 .04 –.0

Cutting, punching, and press machine setters, 

 operators, and tenders, metal and plastic....................... 11,262 6,789 .56 .36 –.20 –3

Multiple machine tool setters, operators, and tenders, 

 metal and plastic ....................................................................... 4,935 2,717 .24 .14 

Bindery workers.............................................................................. 1,710 674 .08 .04 –.05

Extruding and forming machine setters, operators, 

 and tenders, synthetic and glass fibers............................. 1,729 931 .09 .05 –.04

Separating, filtering, clarifying, precipitating, and still 

 machine setters, operators, and tenders.......................... 1,554 1,018 .08 .05 –.0

Helpers—production workers................................................... 13,215 16,798 .65 .89 

 Transportation and material moving occupations

Bus drivers, transit and intercity................................................ 4,929 2,464 .24 .13 

Service station attendants.......................................................... 794 975 .04 .

Crane and tower operators......................................................... 669 853 .03 .05

1

 Numbers are affected by rounding.

Successor

employment

level

Predecessor

employment

share

Successor

employment

share

Difference

in share1

Percent

change in

share1

Demonstrators and product promoters................................ 2,493 939 .12 .05 –.07

Real estate sales agents............................................................... 560 758 .03 .04
Monthly Labor Review • September 2008 11

employees) were home health aides, teacher assistants, 

production worker helpers, medical secretaries, and network systems and data communications analysts.

Relative changes in employment shares. It is useful to examine in detail the occupational groups that fared poorly 

after ownership changes. Table 4 also shows (see columns 

titled “Predecessor employment share” and “Successor employment share”) that, in the computer and mathematical 

science group, which shrank the most in the ownership 

change subsample and grew in the control subsample, 

there were decreases in the employment shares of computer 

programmers, operations research analysts, and computer 

systems analysts. Network systems and data communications analysts, by contrast, were in higher demand. Among 

business and financial operations occupations, which had 

the second-largest difference in employment in the ownership change subsample relative to occupations in the 

control subsample, financial analysts and management 

analysts were most likely to be cut. Meanwhile, logisticians 

and compliance officers (except agriculture, construction, 

health and safety, and transportation) were most likely 

to grow. In the management group, compensation and 

benefits managers saw the greatest employment increase 

after ownership changes, while marketing managers saw 

decreases in employment share.

One possible interpretation of these observations is 

that if the establishment is acquired by an establishment 

with similar staff, the employees who are more likely to 

be let go are those who appear to have redundant occupations. For example, an establishment that is acquired 

may no longer need a separate information technology or 

marketing department. Instead, it may have an increased 

need for occupations such as network systems and data 

communications analysts or human resources personnel 

to facilitate the organizational transition.Other occupations that deal more directly with customers or output, 

such as home health aides, medical secretaries, teacher assistants, and production assembly workers, might need to 

be retained in order to maintain good customer service or 

productivity. These occupations tend to be closely related 

to the core output of the establishment, while the others 

tend to serve as operational support. The decline in certain technical jobs also might be explained by outsourcing, 

although this interpretation is not examined here.12

Occupational composition by wage range

A brief analysis of occupational employment share by 

wage range reveals that, after ownership changed, the 

wages of the employees performing analytical and administrative work shifted upwards, while the wages of the employees performing low-skilled service work or physical 

labor shifted downwards. Until November 2005, the OES

microdata included data on detailed occupational employment in the wage ranges defined in table 5.13 Different occupational groups generally have their employment 

distributions concentrated in different wage ranges. For 

instance, management and computer and mathematical 

occupations were employed mostly in wage ranges starting at $21.50 to $27.24 and running through $55.50 to 

$69.99. Production and personal care and service occupations, however, were employed mostly in ranges beginning 

at $6.75 to $8.49 and going through $17.00 to $21.49. 

(The actual employment distributions are not shown in 

the table.)

A shift in employment concentration from relatively 

lower paid employees to relatively higher paid employees 

occurred in several occupational groups. In these groups, 

either high-paid workers were retained or hired more 

often than low-paid workers, or low-paid workers were 

more likely to lose their jobs after ownership changes. A 

shift from low to high wage ranges occurred in analytical and administrative occupational groups such as management; architecture and engineering; computer and 

mathematical science; business and financial operations; 

health care practitioner and technical; community and 

social services; office and administrative support; and 

arts, design, entertainment, sports, and media, among 

other occupations. If high pay is correlated with tenure 

and knowledge, then high-earning workers may be the 

most costly to replace. This shift from low to high wage 

ranges also may be a result of businesses laying off workers with less tenure: although workers in analytical and 

administrative occupations were less likely to be retained 

after ownership changes, the employees who remained 

had higher wages.

Conversely, employees who performed low-skilled service, physical labor, or personal service work exhibited a 

shift toward lower wage ranges, possibly because the lowpaid workers were retained or hired at higher rates than 

their higher paid counterparts or because higher paid 

workers received pay cuts. Among these workers were 

food preparation and serving related, sales and related, 

protective service, personal care and service, construction 

and extraction, production, transportation and material 

moving, and health care support occupations. Although 

many of these lower skilled service, physical-labor-intensive, or personal service occupations were most likely 

to be retained after ownership changes, they experienced 
Business Ownership Change

12 Monthly Labor Review • September 2008

 Wages shifted higher

Management............................ –0.33 –0.25 –0.70 –0.99 –1.80 –1.73 –2.74 –1.24 0

Architecture and 

 engineering............................ – –.08 .12 –.29 –.49 –2.66 –3.75 .91 2.66 2.03 1

Computer and 

 mathematical science ........ .08 –.16 –1.27 .22 –2.31 –2.18 –.26 4.37 2.59 –.27 –.5

Business and financial 

 operations.............................. .45 .23 –.63 1.15 –2.48 –3.65 –1.29 .87 2

Health care practitioner

 and technical ...................... –.64 –1.31 –3.16 –3.18 –1.42 –3.97 .55 7.04 

Office and administrative 

 support.................................... –.17 .36 –3.77 1.67 2.36 –.55 .22 .01 –.0

2

) ()

Community and social 

 services.................................... –2.82 –3.02 –3.90 3.90 2.27 3.46 1.14 .

Building and grounds 

 cleaning and 

 maintenance ........................ –2.23 –8.69 11.12 .52 .54 –.78 –.29 –.05 –.11 

Farming, fishing, and 

 forestry..................................... –27.17 2.11 11.51 6.23 3.31 1.22 1.75 – 

Arts, design, entertainment,

 sports, and media ............... –1.34 .83 1.70 1.66 –1.09 –2.97 –3.89 3.27 1.13 

Life, physical, and social 

 science ..................................... – .17 –.18 2.22 –2.22 –4.56 –5.46 .92 .63 2.0

Legal ............................................ – –.08 –.49 –5.10 2.28 1.20 –3.55 –1.29 –2.90 –.52 2.

 Wages shifted lower

Food preparation and 

 serving related...................... 6.49 .30 –4.73 –.96 –.91 –.20 .02 .01 .00 –.0

Protective service.................... –2.17 –1.10 10.00 5.79 –.68 –2.26 –4.30 –3.80 –1.15 –

Education, training, and 

 library ....................................... –.88 .99 .14 14.65 –5.56 –7.21 2.35 –2.96 –4

Personal care and service ........ –2.42 8.77 12.32 –2.25 –5.62 –6.25 –3.10 –.99 –.

Construction and 

 extraction................................ 2.26 1.90 .45 4.30 .62 –1.66 –3.88 –2.86 –.99 –.1

Installation, maintenance, 

 and repair................................ .51 –.45 –.96 1.96 –2.37 2.22 –2.98 2.18 –.04 –.02

Production................................. .51 6.02 –3.47 –3.55 –3.03 2.61 –.34 1.2

Transportation and 

 material moving................... 2.63 4.24 –3.76 –.11 –.92 1.30 –.74 .01 –.3

Health care support............... –2.37 2.14 6.11 –4.13 -1.77 –.19 .23 .0

Sales and related..................... 4.37 –.37 –1.14 1.04 –1.29 –1.35 –1.22 .17 .0

downward shifts in their wages. This phenomenon could 

have occurred either because management was more likely 

to spare cheaper labor and employees in these occupations 

were willing to work at lower wages or because higher 

wage workers were replaced with lower wage workers. 

Table 5 shows the difference between the predecessor and 

successor employment shares for each occupational group 

in each wage range.14 This study does not examine wage 

range shifts in detailed occupations within occupational 

groups; therefore, it does not explain whether an occupational group’s wages shifted to lower ranges because more 

low-paid occupations were hired within the group or because more high-paid occupations within the group were 

laid off or accepted pay cuts.

 Difference between predecessor and successor employment shares, by hourly wage range, ownership change

 subsample, 2000–061

 Table 5.

Under

$6.75

$6.75

 to

$8.49

$8.50 

to

$10.74

$10.75 

to

$13.49

$13.50 

to

$16.99

$17.00

to

$21.49

$27.25

to

$34.49

$34.50

to

$43.74

$43.75

to

$55.49

$55.50

to

$69.99

$21.50

to

$27.24

$70.00

and

over

Occupational major group

Difference between predecessor and successor percent employment, by wage range, excluding 2006 

and November 2005 successors and corresponding predecessors

1 Excludes 2006 and November 2005 successors and corresponding

predecessors.

2 Slight negative difference.

3 Slight positve difference

NOTE: Dash indicates fewer than 10 establishments reporting occupations.
Monthly Labor Review • September 2008 1

Sectors most affected by ownership changes

Table 6 shows total employment by industry sector in 

the ownership change subsample predecessor and successor groups, as well as the employment change and the 

percent change in employment from the predecessor to 

the successor groups.15 To provide a basis for comparison 

with all establishments in the economy, the last column 

contains the percent change between 2002 and 2005 

QCEW average annual private-sector employment. (See 

also chart 2.)

About half of the sectors contracted in the ownership 

change subsample while they grew overall in the economy: 

professional and technical services; management of companies and enterprises; finance and insurance; transportation and warehousing; retail trade; construction; real estate 

and rental and leasing; wholesale trade; and other services, 

except public administration. Moreover, all sectors except mining and except health care and social assistance 

either shrank in the ownership change subsample while 

they grew overall, or grew in the subsample by a smaller 

percentage than they grew overall. The information and 

manufacturing sectors contracted substantially more in the 

ownership change subsample than they contracted across 

all establishments. In the information sector, employment 

in establishments that changed ownership fell by 29 percent, while employment in all establishments in this sector 

fell by 9 percent over the same period. Sectors that grew 

in the ownership change subsample, but by less than the 

industry grew as whole, were accommodation and food 

services; arts, entertainment, and recreation; administrative 

and support and waste management and remediation services; and educational services. Mining grew the most in 

the ownership change subsample relative to the economy. 

Much of this growth was due to oil and gas extraction and 

will be discussed in the next section.

That some industries experienced particularly large 

employment declines in the ownership change subsample relative to the economy as a whole might explain 

some large declines in occupational groups that are central to those industries. For instance, in May 2006, sales 

and related occupations made up 54 percent of the retail 

trade industry. The large employment drop in retail trade 

establishments that changed ownership (despite overall 

expansion) between 2000 and 2006 might explain the 

cross-industry observation that sales and related occu-

 Table 6. Employment by industry sector, in the ownership change subsample and across all establishments, 2000–06

Industry

Total

employment

in

predecessor

units

	 Information................................................................. 112,318 80,285 –32,033 –28.

Professional and technical services1.................. 80,795 61,069 –19,726 –24.41 

Management of companies and enterprises1 .... 26,810 21,305 –5,505 –

Finance and insurance............................................ 75,040 60,222 –14,818 –19.

Manufacturing........................................................... 490,076 425,913 –64,163 –

Transportation and warehousing1 ..................... 88,433 78,448 –9,985 –1

Retail trade.................................................................. 247,052 229,464 –17,588 –7.

Utilities......................................................................... 14,661 13,766 –895 –6.10 –

Construction1 ............................................................. 62,733 61,213 –1,520 –2.

Real estate and rental and leasing1.................... 12,794 12,524 –270 –2.1

Wholesale trade1....................................................... 74,235 72,673 –1,562 –2

Other services, except public administration1 ..... 28,956 28,785 –171 –.59

Accommodation and food services................... 119,095 119,452  357 

Arts, entertainment, and recreation.................. 21,136 21,495 359 1.

Educational services................................................ 80,642 84,732  4,090  5.

Administrative and support and waste 

 management and remediation services..... 175,422 185,003 9,581

Health care and social assistance ....................... 286,663 309,902 23,239 8.11

Mining1......................................................................... 5,672 9,630  3,958 69.78

Total

employment

in

successor

units

Difference

between

predecessor

and 

successor

employment

Percent

change from

predecessor

to successor

employment

Percent

change 

betweeen

2002 and 2005 

 average annual

employment,

QCEW

NOTE: Table excludes agriculture, forestry, fishing, and hunting 

1 Ownership change subsample employment difference and overall 

employment difference had opposite signs. 

because the OES and QCEW have incomplete coverage of this sector. Table 

also excludes OES-designated government industries. 
Business Ownership Change

14 Monthly Labor Review • September 20

pations shrank by more in the ownership change subsample than they shrank across establishments in the 

control subsample. Similarly, one might speculate that 

the contraction in professional and technical services establishments and in information establishments contributed to the large decline in computer and mathematical 

science occupations. Likewise, the contraction in manufacturing establishments might have contributed to the 

large decline in production occupations, which made up 

53 percent of the manufacturing sector in May 2006. 

Without a closer look at the data, however, the relationship between the decline in the industry sector and the 

overall employment decline of core occupations is not 

entirely clear. To see whether industries are more likely 

to reduce or retain employment in core occupations or in 

operational support occupations, the next section examines changes in the occupational composition of detailed 

industries.

Occupational change by detailed industry 

In every establishment, workers in certain occupations are 

central to its industry’s core business function, and these 

workers tend to be employed in relatively high concentrations. Establishments also employ operational support, 

or auxiliary, workers in occupations that support the core 

business function. Occupations that serve as support in 

some industries can be the core of other industries. For 

example, in the accounting services industry, billing clerks 

might be a core occupation while janitors are an operational support occupation. By contrast, in the building 

services industry, janitors might be considered the core 

occupation while billing clerks are an operational support 

occupation. Core occupations can be thought of as those 

most directly related to the establishment’s output.

Earlier studies of OES data show that when establishments shrink, they tend to shed support jobs at higher 

rates than they shed core occupations.16 In what follows, 10 industries are examined in further detail to see 

whether, when the declines in employment accompany 

ownership changes, the declines also are concentrated in 

support occupations. The results show that 5 of the highlighted industries experienced a shift in their employment 

concentration from support to core occupations after an 

ownership change, 3 others experienced a shift in employment concentration from core occupations to support oc-

 Chart 2. The effect of business ownership change on industry employment in the ownership change 

subsample and across all establishments, 2000–06: percent change in employment

QCEW, 2002–0

Real trade

70

5

3

10

–10

–3

–5

–70

Transportation and warehousing

Quadrant II

Mining

Quadrant IV

 Health care and social assistance

Finance and insurance

 Educational services

 Administrative and support and waste 

 management and remediation services

Information

Real estate and rental and leasing

Accommodation and food services

Manufacturing

Arts, entertainment, and recreation

Wholesale trade

Other services, except public administration

Professional and technical services

70

5

3

10

–10

–3

–5

–70

–7.0 –50 –30 –10 10  30  

Construction

Utilities

Management of companies 

 and enterprises

Quadrant I

Quadrant III

Ownership

change 

 subsample

Ownership

change 

 subsample
Monthly Labor Review • September 2008 1

cupations, and 2 had little difference in the overall mix of 

core and support occupations after the change.

The 10 industries that contracted the most after ownership changes were computer systems design and related 

services, wired telecommunication carriers, motor vehicle 

parts manufacturing, department stores, grocery stores, 

securities and commodity contracts intermediation and 

brokerage, management of companies and enterprises, 

scheduled air transportation, depository credit intermediation, and plastics product manufacturing. These industries either expanded in the overall economy or shrank by 

a lesser magnitude in the overall economy than they did in 

the ownership change subsample. At the other end of the 

spectrum, oil and gas extraction experienced the highest 

growth in the ownership change subsample (767 percent) 

and the third-highest increase in employment level after 

ownership changes, and the industry grew by a substantially greater magnitude in the subsample than it did in 

the economy. Tables 7–10 show how the employment of 

core and support occupations changed after an ownership change in these selected industries. The percentage of 

industry employment in the predecessor establishments 

represents each occupational group’s employment share 

in the industry, out of total industry employment of the 

predecessor establishments. Likewise, the percentage of 

industry employment in the successor establishments 

represents each occupational group’s employment share 

in the industry, out of total industry employment in the 

successor establishments.

Industries with increased concentrations of core occupations.

In most industries with large employment declines, a 

change in ownership resulted in an increased employment share of core occupations and a decreased share of 

operational support occupations. For example, as shown 

in table 7, in scheduled air transportation there was an increase in the share of core occupations—personal care and 

service occupations, which include flight attendants; and 

transportation and material moving occupations, which 

include pilots. At the same time, there was a decrease in 

the share of support occupations—office and administrative support; and installation, maintenance, and repair 

occupations. It is possible that the decrease was due to 

increased outsourcing in the industry, although this article 

does not examine that possibility.

Similarly, wired telecommunications carriers that changed 

ownership had increased shares of installation, maintenance, 

and repair; computer and mathematical science; and architecture and engineering occupations, and decreased shares of 

office and administrative support, management, and business 

and financial operations occupations. Finally, in securities and 

commodity contracts intermediation and brokerage, there 

likewise was an increase in the shares of core occupations 

such as business and financial operations occupations and 

sales and related occupations (the latter of which includes 

securities, commodities, and financial services sales agents) 

and a decline in support occupations, with computer and 

mathematical science occupations falling from 28 percent 

before the ownership changes to 14 percent afterwards 

and office and administrative support occupations dropping from 19 percent to 15 percent of total employment.

In depository credit intermediation (which shrank in the 

ownership change subsample, but grew overall in the economy), which consists of credit unions and commercial banks, 

the share of core business and financial operations occupations rose from 14 percent to 18 percent of total employment. The share of core office and administrative support 

occupations, which include tellers and similar core occupations employed in banks, was relatively stable at 61 percent, 

and sales and related occupations increased from 4 percent 

to 6 percent of total employment in the industry. The share 

of support occupations, such as management, computer and 

mathematical science, and legal occupations, fell.

Like the aforementioned industries, management of 

companies and enterprises (which shrank in the ownership change subsample, but grew overall in the economy), 

in which operational support is the core business function, had increases in all core occupations and decreases in 

nonessential functions. This observation confirms previous behavioral research which found that when company 

headquarters and auxiliary offices undergo mergers or 

acquisitions, their chief executives tend to protect their 

immediate subordinates, managers, and administrators.17

Industries with decreased concentrations of core occupations. 

Sometimes a change in ownership resulted in a decreased 

employment share of core occupations and an increased 

share of operational support occupations. Industries 

that followed this trend included service industries such 

as grocery stores and department stores. In department 

stores and grocery stores, sales and related occupations 

represent the core of the business function. After an ownership change, the share of sales and related occupations 

in department stores fell from 73 percent to 67 percent, 

as shown in table 8. Similarly, in grocery stores, the share 

of sales and related occupations fell from 38 percent to 36 

percent. In both of these industries, the share of management occupations and office and administrative support 

occupations rose after a change in ownership.

In plastics product manufacturing establishments, the 
Business Ownership Change

16 Monthly Labor Review • September 2008

 

 

 NAICS 4811, Scheduled air transportation

 Total, all occupations....................................... 25,159 20,549 ...

Management ............................................................. 376 188 1.49 .91 

Business and financial operations ...................... 767 684 3.05

Computer and mathematical science ................ 115 139 .46 .68

Architecture and engineering ............................. 640 170 2.54 .83

Legal .............................................................................. 11 11 .04 .05

Arts, design, entertainment, sports, and media ... 133 89 .53

Health care practitioner and technical ............. 12 15 .05 .0

Protective service ..................................................... 11 7 .04 .03 

Food preparation and serving related .............. 91 65 .36 .32

Personal care and service ...................................... 6,892 6,234 27.39  

Sales and related ...................................................... 178 153 .71 .

Office and administrative support ..................... 7,356  5,902 29.24 28.

Installation, maintenance, and repair ............... 3,531 1,761 14.03 

Transportation and material moving ................ 4,968  5,074 19.75

 NAICS 5171, Wireless telecommunication 

 carriers

 Total, all occupations......................................... 42,629  30,277 ...

Management ............................................................. 3,351 834 7.86 

Business and financial operations ...................... 4,807  3,293 11.28 10.

Computer and mathematical science ................ 5,915 5,990 13.88 19.

Architecture and engineering ............................. 3,116 2,570 7.31 8.49

Life, physical, and social science ......................... 416 152 .98 .50

Legal .............................................................................. 161  33 .38 .11

Arts, design, entertainment, sports, and media ... 575 78 1.35 .2

Health care practitioner and technical .............  4 7 .01 .02 

Protective service ..................................................... 12 6 .03 .02 –.

Building and grounds cleaning and 

 maintenance ......................................................... 26 13 .06 .04 

Sales and related ...................................................... 4,114 2,543 9.6

Office and administrative support ..................... 13,138 7,404 30.82 

Construction and extraction ................................ 8  5 .02 .02 –.

Installation, maintenance, and repair ............... 6,937 7,277 16.27 24.03 

Production ..................................................................  3 33 .01 .

Transportation and material moving ................ 21  39 .05 .

 NAICS 5231, Securities and commodity 

 contracts intermediation and brokerage

 Total, all occupations......................................... 9,093 3,482 ...

Management ............................................................. 1,711 687 18.82 19.73 .

Business and financial operations ...................... 1,370 1,214 15.07  34.8

Computer and mathematical science ................ 2,533 489 27.86 14.

Legal .............................................................................. 119 26 1.31 .75 

Sales and related ...................................................... 992  540 10.91 15.5

Office and administrative support ..................... 1,735 509 19.08 14.6

 NAICS 5221, Depository credit 

 intermediation

 Total, all occupations....................................... 28,275 21,465 

Management ............................................................. 2,881 1,774 10.19 8.26 –1

Business and financial operations ...................... 3,860  3,762 13.65 1

Computer and mathematical science ................ 2,718 1,378 9.61 6.42 –3

Architecture and engineering ............................. 88  59 .31 .27 

Life, physical, and social science ......................... 45 49 .16 

Legal .............................................................................. 80 19 .28 .09 –.19

Arts, design, entertainment, sports, and media ... 116  59 .41 .27 

Protective service ..................................................... 51 29 .18 .14

Building and grounds cleaning and 

 maintenance ......................................................... 43 25 .15

 Table 7. Industries with increased concentrations of core occupations, 2000–06

Occupational major group Predecessor

employment

Successor

employment

Predecessor

employment

share

Successor

employment

share

Percentagepoint

difference
Monthly Labor Review • September 2008 17

share of production occupations fell from 59 percent to 57 

percent and the share of transportation and material moving occupations also fell. By contrast, the share of office 

and administrative support occupations and management 

occupations rose. This conjunction of events supports 

Donald Siegel and Frank Lichtenberg’s finding that in 

manufacturing firms, only production personnel, as opposed to nonproduction employees, experienced relative 

employment declines.18

Industries without a clear shift in either core or support 

occupations. Two of the 10 industries examined in this 

section show little difference in the overall mix of core and 

support occupations. However, there was a shift in employment among the core occupations in these industries. 

As table 9 shows, in motor vehicle parts manufacturing 

the share of labor-intensive production occupations rose 

from 65 percent to 67 percent while architecture and engineering occupations; installation, maintenance, and repair 

occupations; and transportation and material moving occupations each decreased slightly. There was little change 

in support occupations, such as management occupations 

and office and administrative support occupations.

In computer systems design and related services 

(which shrank in the ownership change subsample, but 

grew overall in the economy), there were shifts within 

the core and support occupational groups, but there was 

no clear shift toward core occupations. Among core occupations, computer and mathematical science occupations and architecture and engineering occupations saw 

their employment shares remain relatively stable while 

the share of installation, maintenance, and repair occupations, which include computer repairers, increased from 

2 percent to 5 percent. Among support occupations, office and administrative support occupations shrank while 

sales and related occupations grew. Core detailed occupations that increased the most included sales engineers; 

logisticians; network systems and data communications 

 

 

Sales and related ....................................................... 1,081 1,249  3.82  5.82

Office and administrative support....................... 17,255 13,010 61.03 6

Installation, maintenance, and repair................. 40  47 .14 .

Transportation and material moving.................. 9  4 .03 .02

 NAICS 5511, Management of companies

 and enterprises

 Total, all occupations......................................... 26,541 20,953 

Management ............................................................... 3,829  3,691 14.43 1

Business and financial operations........................ 3,480  3,581 13.11 17

Computer and mathematical science................. 1,930 1,748 7.27 8.34

Architecture and engineering ............................... 788 778 2.97  3.71 

Life, physical, and social science........................... 441  324 1.66

Community and social services............................. 82 64 .31 .31

Legal................................................................................ 218 211 .82 1.01 .19

Education, training, and library............................. 8  30 .03 .

Arts, design, entertainment, sports, and media.... 257  324 .97

Health care practitioner and technical............... 736  59 2.77 .28 –

Protective service....................................................... 148 91 .56 .43

Food preparation and serving related................ 410 101 1.54 .48

Building and grounds cleaning and 

 maintenance ........................................................... 370 132 1.39 .6

Sales and related ........................................................ 1,369 1,066  5.16  5.09

Office and administrative support....................... 7,478 6,122 28.18 29.22 1.

Construction and extraction.................................. 259 139 .98 .66 –

Installation, maintenance, and repair................. 886  530  3.3

Production.................................................................... 1,892 670 7.13 3.20 

Transportation and material moving.................. 1,400 1,283 5.27 6.1

NOTE: Detailed data on employment may not sum to total employment because not all occupational groups are listed. 

 Table 7. Continued—Industries with increased concentrations of core occupations, 2000–06

Occupational major group Predecessor

employment

Successor

employment

Predecessor

employment

share

Successor

employment

share

Percentagepoint

difference
Business Ownership Change

18 Monthly Labor Review • September 2008

 

 

 NAICS 4521, Department stores

 Total, all occupations....................................... 72,158 63,752 ... 

Management ............................................................. 1,072 1,026 1.49 1.61 .1

Business and financial operations ...................... 475 232 .66 .3

Computer and mathematical science ................ 13 8 .02 .01 –.

Arts, design, entertainment, sports, and 

 media ....................................................................... 540  571 .75

Health care practitioner and technical ............. 637 622 .88 .98 .0

Health care support ................................................. 35 29 .

1

)

Protective service ..................................................... 1,350 1,295 1.87 2.

Food preparation and serving related .............. 759  576 1.05 .9

Building and grounds cleaning and 

 maintenance ......................................................... 230  342 .32

Personal care and service ...................................... 715 823 .99 1.2

Sales and related ...................................................... 52,902  42,904 73.31 67

Office and administrative support ..................... 11,556 13,805 16.01 2

Construction and extraction ................................ 38 24 .05 

Installation, maintenance, and repair ............... 216  310 .30 .49

Production .................................................................. 387  369 .5

Transportation and material moving ................ 1,218 816 1.69 1.28 –.4

 NAICS 4451, Grocery stores

 Total, all occupations....................................... 83,107 75,679 ... ...

Management ............................................................. 1,186 1,107 1.43 1.4

Business and financial operations ...................... 172 167 .21 .22 .01

Computer and mathematical science ................ 9 16 .01 .02 .01

Arts, design, entertainment, sports, and media .... 241 295 .29 .39

Health care practitioner and technical ............. 1,554 1,830 1.87 

Health care support ................................................. 368  372 .4

Protective service ..................................................... 451 239 .54

Food preparation and serving related .............. 8,731 8,915 10.51 11.78 

Building and grounds cleaning and 

 maintenance ......................................................... 883 610 1.06 .81 –

Personal care and service ...................................... 807  37 .97 .05 

Sales and related ...................................................... 31,705 27,393 38.15 

Office and administrative support ..................... 24,598 22,598 29.60 29.86 

Farming, fishing, and forestry .............................. 108  53 .13 .0

Installation, maintenance, and repair ............... 386 218 .46 .29 –

Production .................................................................. 5,066  4,959 6.10

Transportation and material moving ................ 6,842 6,870 8.23 9.08

 NAICS 3261, Plastics product manufacturing

 Total, all occupations......................................... 19,991 17,835 ... 

Management ............................................................. 758 708  3.79  3.9

Business and financial operations ...................... 265 348 1.3

Computer and mathematical science ................ 59  56 .30 .

Architecture and engineering ............................. 595 815 2.98 

Life, physical, and social science ......................... 77 9 .39 .05

Arts, design, entertainment, sports, and 

media ............................................................................ 29  38 .15 .21

Health care practitioner and technical .............  3 12 .02 .07

Building and grounds cleaning and 

 maintenance ......................................................... 98 89 .49 .50 .

Sales and related ...................................................... 202 282 1.01 1.58 .

Office and administrative support ..................... 1,509 1,435 7.

Construction and extraction ................................ 346 116 1.73 .6

Installation, maintenance, and repair ............... 1,384 1,115 6.92 6.

Production .................................................................. 11,708 10,191  58.57  57

Transportation and material moving ................ 2,954 2,616 14.78 14.67

 Table 8. Industries with decreased concentrations of core occupations, 2000–06

Occupational major group Predecessor

employment

Successor

employment

Predecessor

employment

share

Successor

employment

share

Percentagepoint

difference

1 Slight negative percentage-point difference.

NOTE: Detailed data on employment may not sum to total employment because not all occupational groups are listed.
Monthly Labor Review • September 2008 19

analysts; computer software engineers, systems software; 

computer software engineers, applications; and computer 

support specialists. Meanwhile, the core detailed occupations that decreased the most after a change in ownership 

included industrial engineers; computer specialists, all 

other; computer programmers; and computer hardware 

engineers.

An example of an industry that grew after ownership changes. 

The same study which found that shrinking establishments 

shed support occupations first also found that growing establishments add support occupations first.19 In order to 

contrast employment changes among industries that grew 

after ownership changes with those which declined, one 

growing industry is examined in detail.

The oil and gas extraction industry (which grew by a 

greater magnitude in the subsample than it did overall) 

exhibited a drastic shift from essential labor-intensive 

occupational groups to operational support occupations, 

despite the fact that each occupational group increased in 

 NAICS 3363, Motor vehicle parts

 manufacturing

 Total, all occupations...................................... 35,706 26,44

Management ............................................................ 1,045 716 2.93 2.71

Business and financial operations ..................... 717 618 2.01 2.3

Computer and mathematical science .............. 132 122 .37 .46 

Architecture and engineering ............................ 2,834 1,811 7.94 6.8

Life, physical, and social science ........................ 49  58 .14 .

Arts, design, entertainment, sports, and 

 media ...................................................................... 61 75 .17 .28 .

Health care practitioner and technical ............ 37  38 .10 

Protective service .................................................... 36  33 .10 .

Building and grounds cleaning and 

 maintenance ........................................................ 154 103 .4

Sales and related ..................................................... 474 312 1.33 

Office and administrative support .................... 1,610 1,287  4.51  4.

Construction and extraction ............................... 537  378 1.50 

Installation, maintenance, and repair .............. 2,075 1,186  5.81  4

Production ................................................................. 23,033 17,730 64.51

Transportation and material moving ............... 2,910 1,976 8.15 7.47 –

 NAICS 5415, Computer systems design

 and related services

 Total, all occupations...................................... 33,688 15,081 ...

Management ............................................................ 2,937 1,196 8.72 7.93 –

Business and financial operations ..................... 3,520 1,507 10.45 9

Computer and mathematical science................ 15,005 6,792  4

Architecture and engineering ............................ 2,519 936 7.48 6.21 –1

Life, physical, and social science ........................ 113 93 .34 

Legal ............................................................................. 36 16 .11 .11

1

)

Arts, design, entertainment, sports, and 

 media ...................................................................... 595 269 1.77 1.78

Protective service .................................................... 54 24 .16

1

) 

Sales and related ..................................................... 1,025 801  3.04 5

Office and administrative support .................... 6,767 2,535 20.09 16.81 

Installation, maintenance, and repair .............. 533 717 1.58

Production ................................................................. 471 66 1.40 .4

Transportation and material moving ............... 65 78 .19 .52

 

 Table 9. Industries without a clear shift in either core or support occupations, 2000–06

Occupational major group

Predecessor

employment

Successor

employment

Predecessor

employment

share

Successor

employment

share

Percentagepoint

difference

1 Slight negative percentage-point difference.

NOTE: Detailed data on employment may not sum to total employment because not all occupational groups are listed.
Business Ownership Change

20 Monthly Labor Review • September 2008

employment level in the successor establishments. Core 

construction and extraction occupations in the industry held a dominant 29-percent share before ownership 

changes, but only a 6-percent share afterwards, while the 

share of support business and financial operations occupations increased from almost 7 percent to a dominant 

26 percent after ownership changes. In addition to construction and extraction occupations, the following laborintensive occupational groups decreased in employment 

share after ownership changes: installation, maintenance, 

and repair; production; and transportation and material 

moving occupations. In addition to business and financial 

operations occupations, the following operational support 

occupations increased in employment share after ownership changes: management; computer and mathematical 

science; architecture and engineering; life, physical, and 

social science; and legal occupations. These findings in the 

establishments that changed ownership in the oil and gas 

extraction industry are consistent with those of a separate 

study of recent trends in occupational employment across 

all establishments in the industry.20 This research found 

that, during the recent spate of oil and gas price increases, 

the overall staffing of the industry was shifting away from 

extraction activities and toward exploration. 

Occupational employment by establishment size

This final section shows that changes in occupational composition that followed ownership changes varied by the size 

of the establishment. Establishments were grouped into 

five size classes before and after the ownership change: 1 to 

9 employees; 10 to 49 employees; 50 to 249 employees; 250 

to 999 employees; and 1,000 or more employees. In order 

to focus on changes in occupational composition within 

size classes, the subsample was then divided into five size 

groups based on deviations of fewer than two size classes: 

very small, small, medium, large, and very large.21 Establishments chosen for the study were limited to the 21,923 out 

of the 22,198 establishments that changed by fewer than 

two size classes: 17,166 establishments that did not change 

size class, 2,598 establishments that decreased by one size 

class, and 2,159 establishments that increased by one size 

class.22 As was done in the industry analysis, the percent 

employment of each occupational group in predecessor 

and successor establishments was calculated for every size 

group. The predecessor employment share represents the 

percentage of occupational employment out of total predecessor employment in the size group, and the successor employment share represents the percentage of occupational 

employment out of total successor employment in the size 

group. As before, growth indicates growth in the employment share, or relative importance of the occupation, not 

necessarily growth in the employment level. The changes in 

occupational share are shown in table 11.

Five occupational groups grew in establishments of all 

sizes: life, physical, and social science; health care practi-

 Table 10. Example of an industry that grew after ownership change, 2000–06

Occupational major group

Predecessor

employment

 NAICS 2111, Oil and gas extraction

 Total, all occupations...................................... 441  3,82

Management ............................................................ 36  534 8.16 1

Business and financial operations ..................... 30 997 6.80 26.07 19.

Computer and mathematical science ............... 8 224 1.81  5.8

Architecture and engineering ............................ 33 329 7.48 8.6

Life, physical, and social science ........................ 10  400 2.27 10.46 8

Legal ............................................................................. 2 139 .45 3

Sales and related ..................................................... 2 200 .45 5.

Office and administrative support .................... 68  486 15.42 12.71 –

Construction and extraction ............................... 126 210 28.57  5.49 –

Installation, maintenance, and repair .............. 31 64 7.03 1.

Production ................................................................. 28 76 6.35 1.99 

Transportation and material moving ............... 63 117 14.29  3.06 

Successor

employment

Predecessor

employment

share

Successor

employment

share

Percentagepoint

difference

N.OTE: Detailed data on employment may not sum to total employment because not all occupational groups are listed.
Monthly Labor Review • September 2008 21

tioner and technical; health care support; education, training, and library; and protective service occupations. In contrast, three occupational groups shrank in establishments 

of all sizes: management occupations (with its decrease the 

most in small, very small, and very large establishments), 

sales and related occupations (with its decrease the most in 

medium and large establishments), and office and administrative support occupations (with its decrease the most in 

very small establishments). The direction and magnitude of 

changes in all other occupational groups, however, varied.

Analytical and production occupations—business and 

financial operations; architecture and engineering; legal; 

arts, design, entertainment, sports, and media; and production occupations—did not grow in large and very large establishments. Service occupations—personal care and service; food preparation and serving related; community and 

social services; health care support; health care practitioner 

and technical; education, training, and library; building and 

grounds cleaning and maintenance; and transportation and 

material moving occupations—tended to grow the most in 

very large establishments. 

One interesting observation is that production occupations grew only in very small or small establishments 

and shrank in larger establishments. In fact, there was an 

inverse correlation between the establishment size and the 

effect of ownership change on production occupations. 

This correlation may be the result of larger companies being able to capture economies of scale. Another observation is that computer and mathematical occupations were 

fairly stable in all but the very large establishments. After 

ownership changes, the share of computer and mathematical occupations fell by 2.6 percent, the largest change of 

all occupational groups in any establishment size.

An overview by size group also reveals some trends. Very 

small predecessor establishments, on the whole, were dominated by sales and related occupations and office and administrative support occupations. After ownership changes, the 

greatest decreases were in management, office and administrative support, and sales and related occupations, and the greatest increases were in business and financial operations and 

transportation and material moving occupations. In the small 

size group, the greatest changes were, again, decreases in management occupations and sales and related occupations and an 

increase in business and financial operations occupations. 

In the medium size group, the greatest changes were an increase in protective service occupations and decreases in sales 

 Percentage-point difference between predecessor and successor employment share in the ownership

 change subsample, by establishment size, 2000–06

 Table 11.

Very small

Management.................................................................................... –1.03 –1.33 –0.86 –0

Business and financial operations............................................ .64 .52 

1

) –1.4

Computer and mathematical science ..................................... –.04 .15 .09 .10 –

Architecture and engineering.................................................... –.04 .05 .06 –.11 

Life, physical, and social science................................................ .02 .13 .03 .06

Community and social services................................................. .08 .04 –.08 .18 .

Legal .................................................................................................... (

1

) –.04 .03 –.06

Education, training, and library ................................................. .30 .10 .34 .

Arts, design, entertainment, sports, 

 and media...................................................................................... –.15 .23 .

1

) –.3

Health care practitioner and technical ................................... .14 .17 .29 1.06 2.

Health care support....................................................................... .42 .36 .22 .97 1

Protective service............................................................................ .02 .27 1.04 .8

Food preparation and serving related .................................... .26 –.46 –.02 .21 .7

Building and grounds cleaning and 

 maintenance................................................................................. .19 .04

1

) –.48 .

Personal care and service............................................................. –.40 –.07 .07 –.36 

Sales and related............................................................................. –.78 –.78 –1.04 –1.19 –

Office and administrative support............................................ –1.10 –.22 –.60 –.11 –.3

Farming, fishing, and forestry ................................................... .07 .08 (

1

) .01 .0

Construction and extraction....................................................... .60 .09 –.01 .11 .0

Installation, maintenance, and repair...................................... –.33 –.11 .02 .4

Production......................................................................................... .50 .45 –.03 –1.2

Transportation and material moving ..................................... .64 .33 .30 –

Small Medium Large Very large

Establishment size

Occupational major group

1 Less than 0.05 percentage-point difference
Business Ownership Change

22 Monthly Labor Review • September 2008

and related occupations and management occupations. In the 

large size group, the greatest changes were an increase in health 

care practitioner and technical occupations and decreases in 

production occupations and sales and related occupations. 

Finally, in the very large size group, the greatest changes were 

an increase in health care practitioner and technical occupations and health care support occupations and decreases in 

computer and mathematical science, production, business and 

financial operations, and management occupations.

OCCUPATIONS THAT WERE LEAST LIKELY to be retained 

after ownership changes were those which performed analytical, clerical, and production work, and most of these groups’ 

wages shifted toward higher ranges. These occupations tended 

to be support occupations in the industries in which their employment shares declined. Some of them declined in establishments of all sizes, although many shrank the most in large and 

very large establishments. Analytical and production occupations did not grow in large establishments.

In contrast, many of the jobs that were more likely to 

be retained after ownership changes were those which performed service work, such as health care and education, and 

most of these groups’ wages shifted toward lower ranges. 

Very large establishments were most likely to retain their 

service occupations after changing ownership.

This article leaves room for future research on the effect of ownership changes on occupational employment 

and wages. The methodology for identifying specific types 

of ownership changes and capturing more predecessor 

and successor establishment staffing data can be refined. 

Further regression analysis can be conducted on the effect 

of ownership changes on core and support business functions, on wages by detailed occupation, and on staffing 

by industry or geographic location. OES data are an important input in understanding and predicting the labor 

market outcomes of business dynamics.

Notes

1

  Counts include mergers, full- or partial-interest acquisitions, divestitures,

and leveraged buyouts valued at $5 million. See Statistical Abstract of the 

United States, 2006 (U.S. Census Bureau, 2007), Table 751, “Mergers and

Acquisitions—Summary, 1990 to 2003.”

2

  “What Goes Up, Must Come Down?” Mergers & Acquisitions: The 

Dealermaker’s Journal, July 2007, pp. 10-11; on the Internet at search.ebscohost.

com.proxy2.library.jhu.edu/login.aspx?direct=true&db=buh&AN=25593842

&site=ehost-live (visited Sept. 8, 2007).

3

  Donald Siegel and FrankLichtenberg,“TheEffect of Ownership Changes

on the Employment and Wages of Central-Office and Other Personnel,”

Journal of Law and Economics, October 1990, pp. 383–408.

4

  Robert McGuckin and Sang Nguyen, The impact of ownership changes: a view 

from labor markets (U.S. Census Bureau, Center for Economic Studies, 2001).

5

  Robert McGuckin, Sang Nguyen, and Arnold Reznek, “On Measuring

the Impact of Ownership Change on Labor: Evidence from U.S. FoodManufacturing Plant-Level Data,” in John Haltiwanger, Marilyn Manser, and

Robert Topel (eds.), Labor Statistics Measurement Issues, NBER Studies in Income

and Wealth, vol. 60 (Chicago, University of Chicago Press, 1998).

6

  Approximately 2 percent of the wage data were imputed.

7

  In addition, 1,233 establishments reported 3 times, and 5 firms reported 4

times; these 1,238 firms were excluded from the ownership change subsample.

The exclusion of establishments that reported more than twice should not

introduce significant bias into the subsample.

8

  See, for example, the Thomson Financial Merger and Corporate Transactions database, on the Internet at www.census.gov/compendia/statab/2006/

tables/06s0752.xls. Mergers, full- or partial-interest acquisitions, divestitures,

and leveraged buyouts valued at $5 million or more are listed in the database.

9

  The method for obtaining published OES estimates applies weights for

each sample establishment in each panel of the survey in order to represent all

establishments that were part of the in-scope frame from which the panel was

selected. In the study presented in this article, employment was not adjusted by

the unit sampling weights.

10  According to QCEW annual private-sector employment figures, total

employment was 107,577,281 in 2002 and 110,611,016 in 2005.

11  Occupations listed are those whose employment shares grew or declined

by at least 0.01 percentage point and 30 percent from the predecessor to the

successor group.

12  For a discussion of the outsourcing of technical jobs,see Ashkok Bardhan

and Cynthia Kroll, “The New Wave of Outsourcing,” Fisher Center Research

Report No. 1103 (Berkeley, CA, Fisher Center for Real Estate & Urban

Economics, November 2003), on the Internet at repositories.cdlib.org/iber/

fcreue/reports/1103 (visited Sept. 26, 2008); Alan Blinder, “How Many U.S.

Jobs Might Be Offshorable?” CEPS Working Paper No. 142 (Princeton, NJ,

Center for Economic Policy Studies, March 2007), on the Internet at www.

princeton.edu/~ceps/workingpapers/142blinder.pdf (visited Sept. 26, 2008);

and J. Bradford Jensen and Lori G. Kletzer, “Measuring Tradable Services and

the Task Content of Offshorable Services Jobs,” paper presented at the National

Bureau of Economic Research Conference on Research in Income and Wealth,

titled “Labor in the New Economy,” November 16–17, 2007, Washington, DC,

on the Internet at people.ucsc.edu/~lkletzer/TradableServices&Job_task_

content_110907.pdf (visited Sept. 26, 2008).

13  Because the wage range definitions were revised in November 2005, the

successor data collected with November 2005 and May 2006 reference dates,

as well as their corresponding predecessor records, were removed from the

subsample solely for this wage analysis. The wage analysis used 14,828 unique

establishments (29,656 predecessor and successor records).

14  The employment share of an occupational group in, for example, the

wage range headed “Under $6.75” is the percentage of employment in that

occupational group out of total employment in the occupational group.

15  A few establishments changed their industry classification when they

reported the second time, but most that did so did not change industry sector.

For consistency, the successors’ industries were assigned to the predecessors’.

16  Zachary Warren, “Occupational Shares in Growing and Shrinking

Establishments,” Occupational Employment and Wages (Bureau of Labor

Statistics, May 2005), pp. 1–14; see especially p. 5.

17  Andre Shleifer and Robert Vishny, “Value Maximization and the

Acquisition Process,” Journal of Economic Perspectives, winter 1988, pp. 7–20.

18  Siegel and Lichtenberg, “The Effect of Ownership Changes.”
Monthly Labor Review • September 2008 2

19  Warren, “Occupational Shares.”

20  Jeffrey Holt,“Recent Changes in Occupational Employment and Wages

in Oil and Gas Extraction,” internal BLS document, 2008.

21  The very small group consisted of establishments with 1–9 employees

before the ownership change and either 1–9 employees or 10–49 employees

after the ownership change. The small group comprised establishments whose

predecessors were in the 10–49-employee size class and whose successors

stayed in the same size class or changed by one size class. The medium group

encompassed establishments whose predecessors were in the 50–249-employee

size class and whose successors were in the same size class or one size class below

or above it.The large group consisted of establishments whose predecessors were

in the 250–999-employee size class and whose successors were in the same size

class or one size class below or above it. Finally, the very large group comprised

establishments whose predecessors started in the employee size class of 1,000

or more and whose successors either remained in this size class or contracted to

the 250–999-employee size class.

22 Excluded from the study were the 246 establishments that changed by 

two size classes, the 25 establishments that changed by three size classes, and 

the 4 establishments that changed by four size classes. Small units might have 

been acquired by larger corporations with the intent to expand them, so their 

occupational employment changes are relative extremes.