Labor Productivity in Transportation

Labor Productivity in Transportation

Labor productivity (output per hour) in the for-hire transportation services and petroleum pipeline industries increased by 20 percent from 1990 to 2000. This compares with an increase of 45 percent for all manufacturing and 23 percent for the overall business sector (figure 1). Labor productivity, a common and basic productivity measure, is calculated as the ratio of output to hours worked or to the number of full-time employees.

The growth of individual transportation subsector labor productivity between 1990 and 2000 varied (figure 2). Compared with the overall business sector, several transportation modes had considerably higher rates of increases in labor productivity, and some lower, over the same period. Railroad labor productivity increased 65 percent, as did local trucking, while pipeline productivity grew 38 percent. On the other hand, labor productivity in air transportation increased 19 percent, “trucking except local” increased 18 percent, and Class I bus carriers rose 16 percent.

Comparing annual growth rates is another way to interpret changes of labor productivity over time. For overall business, labor productivity grew at an average annual rate of 2 percent between 1990 and 2000. Labor productivity in rail transportation—where productivity has been affected by consolidation of companies, more efficient use of equipment and lines, increased ton-miles (output), and labor force reductions—increased by 5 percent annually. Labor productivity of local trucking also grew at 5 percent annually.

The lowest annual labor productivity growth rates were for pipelines (3 percent), trucking except local subsector (1.7 percent), and air transportation (1.8 percent). Bus carriers’ productivity grew 1.5 percent but with considerable fluctuation over the period of analysis.