Labor Productivity in the Retail Trade Industry, 1987-99: Faced with Fierce Competition, Consolidation, and Increased Demand, the Industry Experienced Strong Growth in Labor Productivity over the Period, Partially Due to Increased Investments in Information Technologies. (Productivity in Retail Trade)

By Sieling, Mark; Friedman, Brian et al. | Monthly Labor Review, December 2001 | Go to article overview

Labor Productivity in the Retail Trade Industry, 1987-99: Faced with Fierce Competition, Consolidation, and Increased Demand, the Industry Experienced Strong Growth in Labor Productivity over the Period, Partially Due to Increased Investments in Information Technologies. (Productivity in Retail Trade)


Sieling, Mark, Friedman, Brian, Dumas, Mark, Monthly Labor Review


Retail trade employed 22.8 million persons in 1999 and generated sales of nearly $3 trillion. The large size of the retail sector results in a high degree of interest in monthly and especially holiday retail sales and makes the performance of this sector important to the overall health of the U.S. economy. In addition, it has been suggested that "the retail sector ... is particularly important in creating jobs for groups with high unemployment levels, employing relatively large numbers of women, young people and the people with little education. It is also a major provider of part-time work." (1)

The retail sector is a competitive and dynamic part of the U.S. economy. Retail stores offer goods bundled with services such as store location, product assortment, timely delivery, product education, and store ambience. (2) Differing retail store formats have evolved offering varying degrees of these services. (3)

Output and labor productivity in retail trade experienced strong growth over the 1987-99 period. Strong demand for retail products corresponded with gains in labor productivity. (See chart 1.) In addition, growth in retail square footage far exceeded population growth over the period. (4) As a result, the industry has been faced with overcapacity of retail space, which in turn has led to continued fierce competition, consolidation under large corporations, and increasing bankruptcies and liquidations. (5)

[GRAPHIC OMITTED]

A long-term trend in retailing that began well before 1987 and continued into the 1990s was increased concentration. The proportion of sales accounted for by the largest 50 firms and the largest 4 firms increased in nearly all retail industries between 1977 and 1997. (6) Stores belonging to chains became more dominant in the industry, and the growth in chain stores was accompanied by growth in investment in information technologies, largely due to the widespread use of Universal Product Codes (UPC's).

UPC's are machine readable labels placed on product packaging containing a series of bars (bar codes) and numbers that provide information on the manufacturer, a description of the item, and its price. This technology allows retailers to gather data at the point of sale (POS) with laser-based bar code scanners. The information is then used to pinpoint markets and better manage inventories, UPC's were first used in the food store industry and quickly spread to general merchandising and eventually all segments of retail trade. (7)

The Bureau of Labor Statistics has maintained measures of labor productivity for all three- and four-digit Standard Industrial Classification (SIC) code industries in retail trade for several years. (8) In June, 2001 BLS published measures of labor productivity for the total retail trade sector, as well as for each of the eight major groups within retail, defined at the two-digit level of the SIC system.

Over the 1987-99 period, labor productivity for the total retail trade industry grew by an average annual rate of 2.0 percent per year, reflecting annual output growth of 3.4 percent and average annual hours growth of 1.4 percent. (9) During the second half of the 1990s, labor productivity growth for retail trade accelerated sharply. (See chart 2.) During the 1995-99 period, labor productivity increased at an average annual rate of 3.1 percent or about twice the increase seen during the 1990-95 period (1.6 percent). This pattern, to various degrees, also was evident in each of the two-digit SIC industries in retail, with the exception of apparel stores.

[GRAPHIC OMITTED]

Productivity in the total nonfarm business sector also experienced a speedup during this later period. One factor unique to retail trade during the 1995-99 period was an increased use of POS systems, which electronically link cash registers, laser scanning devices, and credit card processing machines with sophisticated software packages. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • A full archive of books and articles related to this one
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Labor Productivity in the Retail Trade Industry, 1987-99: Faced with Fierce Competition, Consolidation, and Increased Demand, the Industry Experienced Strong Growth in Labor Productivity over the Period, Partially Due to Increased Investments in Information Technologies. (Productivity in Retail Trade)
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

    Already a member? Log in now.