Productivity measures for retail trade: data and issues

Marilyn E. Manser is the associate commissioner of the Office of Productivity and Technology, Bureau of Labor Statistics. A preliminary version of this article was presented at the Workshop on Services, held at the Organisation for Economic Co-operation and Development, Paris, France, November 15–16, 2004. The retail trade industry is a major component of the U.S. economy, with employment exceeding that in manufacturing. Yet only recently has the strong productivity performance of the retail sector been widely noted. Analysis of productivity growth in retail trade is especially challenging because it involves defining what output is for the industry, and different concepts can be used. This article discusses conceptual and other issues in measuring productivity for retail trade industries, and presents current information on productivity in these industries in the United States. First it discusses the classification of retail trade activities. Second, it focuses on issues in defining the output concept for retail trade and in obtaining operational measures. Third, it presents data and comparisons for various measures and fourth, it addresses issues in comparing changes in retail trade productivity across countries.