July 2004, Vol. 127, No. 7
Labor month in review
Information sector productivity
The July Review
Job creation and job losses are among the most visible indications of a dynamic economy. The recently-introduced BLS data on Business Employment Dynamics promise to shed a great deal of light on the details underlying the dynamism that pervades the U.S. economy. Cordelia Okolie uses the Business Employment Dynamics data to examine the effect one’s choice of method for determining the size class of an establishment makes in understanding the relative influences of smaller and larger businesses on job creation. To facilitate additional analysis of these issues, BLS plans to release research series using the three most widely used methods of assigning an establishment to a particular size class.
Steven Hipple updates the prevalence and characteristics of self-employment in the American labor market. The proportion of workers who are self-employed in an unincorporated business has fallen steadily since the first measurement was taken in 1948, but there were still more than 10 million such workers in 2003.
Lynn A. Karoly and Julie Zissimopoulos follow with a look at self-employment among older workers. Noting that rates of self-employment tend to rise with age, Karoly and Zissimopoulos suggest that the demographics of an aging population may slow or even halt or reverse the trend away from working for oneself.
Richard W. Johnson looks at older workers from the perspective of the demands placed on them by their jobs. Although the physical demands of work have declined, Johnson finds that, "the rigors of employment remain daunting for many older adults." The balance between the rigors of employment and the need for income will have important consequences for retirement policy.
Information sector productivity
Productivity, as measured by output per hour, increased in all but one of the information industries in 2002. In the detailed four- and five-digit information industries, the majority of the gains were greater than 4 percent. Double-digit productivity growth (11.2 percent) occurred in wireless telecommunica-tions carriers. The one information industry to register a productivity decline was motion picture and video exhibition.
All of the information industries except motion picture and video exhibition saw reductions in unit labor costs. Unit labor costs fell 16.9 percent in wireless telecommunications carriers and 9.7 percent in software publishers. Additional information is available from "Productivity and Costs in Selected Service-Providing and Mining Industries, 2002," news release USDL 04–1061.
Fringe benefits vary widely by geographic, establishment, and worker characteristics. For example, the number of days of paid vacations workers get each year typically increases the longer workers remain on the job. The vacation benefit also varied by a worker’s union or nonunion status. For example, at 1 year of service, union and nonunion workers were eligible for almost the same number of days, whereas, after 25 years of service, union workers enjoyed 6 more paid vacation days than did nonunion workers.
Access to retirement benefits varied by the characteristics of the employer’s establishment. Workers in goods-producing industries, for example, are more likely to have access to retirement benefits than are workers in service-providing industries. In addition, workers in medium-sized and large private establishments (those with 100 employees or more) enjoyed a higher rate of access to retirement benefits than did their counterparts in smaller establishments.
Workers in medium-sized to large establishments also had greater access to medical care benefits. Seventy-two percent of employees in establishments with 100 or more workers had access to a medical care plan. In contrast, fewer than half of employees in small establishments had access to such a plan.
Access to many benefits may also depend on a worker’s occupation. Workers in service occupations had far less access to life insurance in March 2003 than did white-collar or blue-collar workers. At 56 percent, workers in white collar occupations had the highest access rate to life insurance. Access to life insurance among blue-collar workers was 53 percent. Among service workers, the rate was just 29 percent.
A worker’s wage rate is also related to access to benefits. Workers in occupations averaging $15 an hour or more were in a much better position with respect to access to benefits than were those in occupations averaging under $15 in March 2003. The difference was particularly striking in rates of access to long-term disability insurance. Only 17 percent of those earning under $15 had access to such coverage, compared with half of those in the higher earnings category. With regard to short-term disability insurance, 29 percent of those earning less than $15 per hour had access to this benefit, while 53 percent of those earning more than $15 per hour had access. Learn more about the factors affecting benefits in "National Compensation Survey: Employee Benefits in Private Industry in the United States, March 2003," (PDF) Summary 04-02.
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