Academic journal article Monthly Labor Review

Productivity Trends in the Furniture and Home Furnishings Stores Industry

Academic journal article Monthly Labor Review

Productivity Trends in the Furniture and Home Furnishings Stores Industry

Article excerpt

Productivity trends in the furniture and home furnishings stores industry

Productivity, as measured by output per hour of all persons, grew at an average rate of 3.0 percent in the furniture and home furnishings stores industry from 1967 to 1985.(1) This gain is significantly above the productivity growth rate for the nonfarm business sector of the economy, which was 0.9 percent during the same period. The productivity trend rate in the furniture and home furnishings stores industry reflects an increase in output of 4.8 percent and a gain in hours of all persons averaging 1.8 percent.

Productivity growth in this industry compared favorably with trends in other retail trade industries measured by the Bureau of Labor Statistics. Apparel stores had a slightly higher productivity growth rate of 3.6 percent during 1967-85. However, drug stores had a lower rate of 2.3 percent and retail food stores which posted an actual decline of 0.8 percent in productivity had a significantly lower rate.

The furniture and home furnishings stores industry comprises a variety of different retail stores besides furniture stores. These include stores selling floor coverings, draperies, curtains, upholstery, miscellaneous home furnishings such as glassware, household appliances, radios and televisions, and music and records. Productivity measures have been developed for the furniture and home furnishings stores component of the industry and the appliance, radio, TV, and music stores component, as well as for the overall industry.

Productivity growth was significantly different in the two components of the industry. Productivity grew at the high rate of 4.6 percent in the appliance, radio, and TV stores component from 1967 to 1985 while increasing at less than half that rate, 1.9 percent, in the furniture and home furnishings component. The appliance, radio, and TV stores component had a significantly higher rate of output growth, 6.6 percent per year, fueled by significant increases in demand for such fast-selling items as microwave ovens, video recorders, color television sets, and personal audio equipment. On the other hand, output of the furniture and home furnishings stores component grew at the slower rate of 3.6 percent over the 1967-85 period. This component of the industry was significantly affected by economic downturns during the period. The growth rate for hours of all persons was relatively similar for the two components of this industry, increasing at a rate of 2.0 percent in appliance, radio, and TV stores and at a rate of 1.6 percent in furniture and home furnishings stores.

Subperiod trends

Productivity growth can be divided into three periods in the furniture and home furnishings stores industry. From 1967 to 1973, productivity grew at the comparatively high rate of 4.3 percent in the overall industry as output increased at the very high rate of 6.7 percent. The productivity advance slowed to a 1.5-percent rate from 1973 to 1978 as output gains also slowed to 3.7 percent per year. From 1978 to 1985, productivity growth picked up to a 3.0-percent rate as output growth increased to 4.5 percent. (See table 1.)

The trends in the overall industry reflected differing productivity and output growth rates in the component industries in the more current periods. In the furniture and home furnishings stores component, productivity experienced a high growth rate of 4.3 percent from 1967 to 1973 as output expanded significantly. Productivity fell to a rate of 1.0 percent from 1973 to 1978 and continued at a 1.3-percent rate in the 1978-85 period. In the appliance, radio, and TV stores component, productivity also grew at a high rate of 4.4 percent from 1967 to 1973 with output increasing at a 6.0-percent rate. From 1973 to 1978, productivity in this component slowed to a rate of 2.2 percent, despite an output growth rate of 5.7 percent. However, productivity growth accelerated in this component to a rate of 5. …

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