Trade affected workers in the service sector: 1987 and 1990

American Journal of Economics and Sociology, The,  April, 1995  by Bartholomew Armah

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IV

Data Sources

The input output model used by the study is based on the Office of Employment Projection's (OEP) 1987 and 1990 228-sector input-output tables which cover a total of 115 manufacturing and 80 services producing industries. Input output tables provide information on inter-industry technical coefficients and final demands including exports and imports. The output measures follow the definitions and conventions used by the Bureau of Economic Analysis (BEA) in its input-output tables which are published every five years. These industry output measures are based on producer's value and include both primary and secondary products and services. Both the 1990 and 1987 tables are expressed in 1987 dollars and have been adjusted by the Bureau of Labor Statistics (BLS) to reflect the 1987 Standard Industrial Classification (SIC) revision.

Employment output ratios were based on 1987 and 1990 wage and salary employment data obtained from the Office of Employment Projections. The ratios are estimated by dividing wage and salary employment per sector by the total output of the corresponding sector. Current Population Studies (CPS) data for 1987-1990 period were used to determine the demographic characteristics of service workers in the three industry categories. Since, thirty six of the 80 service industries generated zero trade-related employment, demographic characteristics are only provided for the 44 remaining industries.

Combining CPS data with OEP I-O data can be problematic since CPS and I-O industry classifications do not necessarily coincide. However, with few exceptions, exact matches were made for most of the service industries. In three cases (photocopy, commercial art, photofinishing; insurance carriers; insurance agents and brokers) where this was not possible, the relevant industries were excluded. In two other cases (passenger transport arrangements and miscellaneous repair shops) some reconciliation between the two classification schemes was necessary (See Appendix).

V

Results

The trade-related employment performance of the three service industry categories together with their demographic characteristics are provided below. A. Trade-Related Employment. Service industries which enjoyed an increase in (positive) net trade-related employment between 1987 and 1990, created an average of 555.66 jobs and experienced a 68 percent growth in employment. Leading the way in job creation was air transport (350.6 jobs) followed by computing and data processing services (87.5 jobs).

On the other hand, industries which suffered a decline in (positive) net trade-related employment between 1987 and 1990, created an average of 654.3 trade-related jobs in both years. However, trade-related employment fell by 14.5 percent over the period. Trucking and warehousing (407.2 jobs), engineering and architectural services (96.9 jobs) and management and public relations (58.3 jobs) were significant sources of trade-related employment in this industry category.

With the exception of advertising, service industries which suffered net employment losses in 1987 and 1990 experienced improvements over the period. Even though the latter industries lost an average of 1,618.8 potential jobs, potential employment losses were approximately 30 percent less in 1990 than in 1987. Wholesale trade (-931.8 jobs) and real estate (-304.8 jobs) were among the biggest job losers in this industry category. The ratio of average net employment gains to losses for all service industries was 0.747 reflecting a deficit in service sector trade-related employment creation. B. Demographic Effects. Table 4 provides the characteristics of service industries which experienced positive/negative net trade-related employment in 1987 and 1990 regardless of trend. It reveals no obvious correlation between skill-intensity and trade-related employment performance. The share of laborers (unskilled workers) and (with the exception of managers) highly skilled workers is higher in service industries which enjoyed net trade-related employment gains than in industries which suffered net trade-related employment losses in both years.