Business Services Industry
Evaluating the 1995 industry employment projections - Cover Story
Monthly Labor Review, Sept, 1997 by Arthur Andraessen
The 1995 BLS projections of industry employment foretold the trend of almost all major industry groupings, as the economy hewed closely to the path projected for it
BLS industry employment projections correctly described most broad industry trends over the 1984-95 period. Most of the major industry sectors projected to have faster-than-average growth did so, and 2 of the 3 major sectors projected to decline did lose employment from 1984 to 1995. Services and retail trade were projected to account for 65 percent of the net change in employment, which was very close to the actual 72 percent they attained. Downsizing, which has resulted in the contracting out of many operations, especially in manufacturing industries, is one of many factors that have led to a growth in services faster than that projected.
Major industry sectors
Total wage and salary employment was underprojected by 6.6 million, reflecting chiefly the 3.1 million underprojection of the labor force, but also the unforeseen faster growth of wage and salary employment, compared with that of the labor force. The faster growth stemmed from an unexpected increase in dual jobholders over the projection period. Despite the large numerical underprojection of total employment, the projected 1995 distribution of employment by major industrial sector closely matched the actual distribution. Indeed, the shares of total employment for all but two sectors, agriculture and wholesale trade, were projected to change in the correct direction. Agriculture's show was projected to decline, but it maintained its small 1.7 percent of employment This was because, although agricultural production declined as projected, a rapid growth in agricultural services, stemming largely from lawn care services, offset that decline. Wholesale trade's share was projected to increase from 5.7 percent to 5.9 percent but it actually dropped to 5.3 percent. Wholesale trade was the only sector whose employment growth rate was incorrectly projected to be faster than total employment. The industry grew more slowly than projected because manufacturing, an intensive user of wholesale trade distribution services, grew more slowly than projected. (See table 1.)
Table 1. Wage and salary employment, by major industry group,
1984 actual and 1995 projected and actual
[Numbers in thousands]
1995
Industry 1984 Projected
Level Share
(Percent)
Total, all industries(1) 96,843 112,267 100.0
Agriculture, forestry,
and fisheries 1,668 1,401 1.2
Mining 620 601 .5
Construction 4,726 5,225 4.7
Manufacturing 19,369 20,683 18.4
Durables 11,476 12,986 11.6
Nondurables 7,894 7,697 6.9
Transportation, communications,
and utilities 5,232 6,031 5.4
Wholesale trade 5,568 6,578 5.9
Retail trade, including eating
and drinking places 16,512 19,549 17.4
Finance, insurance,
and real estate 5,683 6,740 6.0
Services 21,517 28,468 25.4
Business and professional
services, except medical 8,011 11,728 10.4
Other services 13,506 16,740 14.9
Government 15,947 16,991 15.1
1995
Industry Actual
Level Share
(Percent)
Total, all industries(1) 118,833 100.0
Agriculture, forestry,
and fisheries 1,976 1.7
Mining 418 .4
Construction 5,407 4.5
Manufacturing 18,405 15.5
Durables 10,596 8.9
Nondurables 7,809 6.6
Transportation, communications,
and utilities 6,280 5.3
Wholesale trade 6,324 5.3
Retail trade, including eating
and drinking places 20,840 17.5
Finance, insurance,
and real estate 6,949 5.8
Services 33,042 27.8
Business and professional
services, except medical 13,479 11.3
Other services 19,564 16.5
Government 19,192 16.2
Industry Percent change,
1984-95
Projected Actual
Total, all industries(1) 15.9 22.7
Agriculture, forestry,
and fisheries -16.0 18.4
Mining -3.1 -32.6
Construction 10.6 14.4
Manufacturing 6.8 -5.0
Durables 13.2 -7.7
Nondurables -2.5 -1.1
Transportation, communications,
and utilities 15.3 20.0
Wholesale trade 18.1 13.6
Retail trade, including eating
and drinking places 18.4 26.2
Finance, insurance,
and real estate 18.6 22.3
Services 32.3 53.6
Business and professional
services, except medical 46.4 68.2
Other services 23.9 44.9
Government 6.5 20.4
Industry Numerical Percent
error, error,
1995 1995
Total, all industries(1) -6,566 -5.5
Agriculture, forestry,
and fisheries -575 -29.1
Mining 183 43.8
Construction -182 -3.4
Manufacturing 2,278 12.4
Durables 2,390 22.6
Nondurables -112 -1.4
Transportation, communications,
and utilities -249 -4.0
Wholesale trade 254 4.0
Retail trade, including eating
and drinking places -1,291 -6.2
Finance, insurance,
and real estate -209 -3.0
Services -4,574 -13.8
Business and professional
services, except medical -1,751 -13.0
Other services -2,824 -14.4
Government -2,201 -11.5
Share of
total growth,
Industry 1984-95
Projected Actual
Total, all industries(1) 100.0 100.0
Agriculture, forestry,
and fisheries -1.7 1.4
Mining -.1 -.9
Construction 3.2 3.1
Manufacturing 8.5 -4.4
Durables 9.8 -4.0
Nondurables -1.3 -.4
Transportation, communications,
and utilities 5.2 4.8
Wholesale trade 6.5 3.4
Retail trade, including eating
and drinking places 19.7 19.7
Finance, insurance,
and real estate 6.9 5.8
Services 45.1 52.4
Business and professional
services, except medical 24.1 24.9
Other services 21.0 27.5
Government 6.8 14.8
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