May 27, 2016
At precisely 8:30 a.m. Eastern time on the first Friday of each month, the U.S. Bureau of Labor Statistics (BLS) releases the most closely watched data about the U.S. economy—the number of jobs created during the past month.
Economic growth is created either by adding to the workforce or by the workforce operating more productively. So, the total number of jobs added is a primary barometer of economic growth.
However, the economy is not like the universe—expanding uniformly in all directions. Rather, some sectors thrive and others wither, so the net sum of all sector contributions is the measure of economic advance. Knowing something about job growth in various box-consuming sectors of the economy is vitally important to independent converters who want to position their business to take advantage of the most attractive market opportunities.
In this article, we will examine the March 2016 employment data by sector and selected industry detail. Primarily, we will examine the change in employment over the 12 months ending this March and learn where jobs have been created or eliminated over that trailing annual period.
“Knowing something about job growth in various box-consuming sectors of the economy is vitally important to independent converters who want to position their business to take advantage of the most attractive market opportunities.”
The table below contains some data that will be used for this analysis. This information and additional details are available to anyone who wants to delve into the statistics on the Bureau of Labor Statistics website, www.bls.gov.
At the end of March 2016, there were 143.8 million people employed in the United States, 3.7 million more than a year earlier. Eighty-five percent of them worked in the private sector. Employment is concentrated in the service sector of our economy. Even though the service sector accounts for about two-thirds of total consumption, it employs a larger 83.4 percent of the workforce. The goods-producing sector also lags in share of new jobs created during the past year. Even though it made up 16.2 percent of the workforce in March, only 13 percent of the new jobs created during the preceding 12 months were in the goods-producing sector. Mining and logging, including oil well drilling, lost 128,000 jobs during the past year, most of them in the energy industry.
On the other hand, the construction industry has been growing rapidly, adding 10.3 percent to its total payrolls during the year ending this March. Yet manufacturing, which makes up 10 percent of private-sector employment, added only 37,000 jobs during the past year, including a loss of 29,000 jobs in February. The entire manufacturing sector accounted for less than 1 percent of all new jobs created in the United States during the last 12 months.
Even within the manufacturing sector where about 80 percent of boxes end up being filled, there is a large difference between employment changes in the durable and nondurable goods sectors. In the durable goods sector, employment decreased by 43,000 jobs last year, while the nondurable goods sector added 80,000 jobs, most of them in food production. According to the BLS, the paper and paper products industry—including corrugated box manufacturing—employed 373,000 people in March 2016 and had added 2,000 jobs during the prior 12 months.
The private service sector employed more than 100 million people in March 2016. During the 12 months ending in March, private-service sector employment rose by 3.5 percent, outpacing the 2.6 percent annual advance in total employment.
Largest individual sector gains during this annual period included retail sales (637,000 new jobs); professional and business services (809,000 new jobs); health care and social assistance (664,000 new jobs); jobs in eating and drinking establishments (up by 542,000); and the amusement, gambling, and recreation sector (189,000 new jobs).
Educational services experienced the largest single-sector decrease during this annual period. Private educational services employment decreased by 98,000, while state government education employment decreased by 150,000 jobs. Local government education jobs decreased by an additional 345,000 jobs, leading to a total U.S. education employment decrease of 593,000 jobs!
In the service sector, there were several categories where employment rose by more than 10 percent during the annual period ending this March: scenic and sightseeing transportation employment advanced by 14.7 percent; services for buildings and dwellings increased by 11.2 percent; and jobs in the amusement, gambling, and recreation area, including casinos, rose by 13.7 percent. In the goods-producing sector, only the construction sector posted a double-digit employment gain of 10.3 percent.
Lastly, taxpayers contributed to net growth in educational government employment. Federal, state, and local government employment excluding education jobs rose by 229,000 during the 12 months ending in March, a 2.0 percent annual increase of taxpayer-funded employment.
All in all, it seems pretty certain that many more employees work to empty the corrugated containers that independent converters manufacture than are employed to fill them in the United States.
Dick Storat is president of Richard Storat & Associates. He can be reached at 610-282-6033 or storatre@aol.com.
