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November 2005, Vol. 128, No. 11
Industry output and employment projections to 2014
Jay M. Berman
Can future economic progress be inferred from historical growth? Will our dynamic economy bring disorder or will it calm the path toward economic stability? Which industries will be the engines of growth and which will be stifled by foreign competition or technological innovation?
With these questions in mind, the Bureau of Labor Statistics develops a set of industry employment and output projections every 2 years. The most recent set projects total employment in the United States to grow by 18.9 million over the 2004–14 period, from 145.6 million to 164.5 million.1 Even though the 1.2-percent rate of growth that this represents is the same pace that occurred over the past decade, approximately 2.6 million more jobs are expected to be created. The vast majority of growth in total employment is attributed to the projected increase of 18.7 million nonagriculture wage and salary jobs, reaching 150.9 million by 2014. The number of agriculture workers—which includes self-employed persons, unpaid family workers, and wage and salary workers—is projected to decline by 229,900. The vast majority of the remaining portion of growth in total jobs is accounted for by an expected increase of 455,500 in nonagricultural self-employed and unpaid family workers, rising to 10.0 million by 2014. (See table 1.)
Real industry output is projected to expand to $27.4 trillion by 2014, an increase of almost $7.7 trillion from 2004.2 The resulting average annual growth rate of 3.6 percent is somewhat faster than the 3.2 percent experienced during the last decade. Real output in the service-providing sector is expected to grow 3.8 percent annually and reach $18.8 trillion by 2014, closely mirroring the 3.7-percent rate exhibited over the 1994–2004 period. The goods-producing sector, excluding agriculture, keeping close pace with its service-providing counterpart, is expected to expand at a 3.2-percent annual rate, which is significantly higher than the 2.1 percent experienced between 1994 and 2004. The economy is expected to remain service dominated as the goods-producing sector’s share of current-dollar total output continues to decline, from 30.8 percent in 1994 to 24.5 percent by 2014.3 Annual real output growth in agriculture is expected to keep pace with its historical 10-year rate of 1.7 percent, slowing only slightly during the projected period to 1.6 percent. Agriculture’s share of total nominal output, however, is expected to further drop to only 1.0 percent by 2014, down from 1.3 percent in 2004. (See table 2.)
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1 Total employment is a summation of nonagriculture wage and salary employment, which is from the BLS Current Employment Statistics survey, plus self-employed, unpaid family workers, and agriculture, forestry, fishing, and hunting workers, which are from the Current Population Survey.
2 This article uses the gross duplicated output concept. Gross duplicated output measures not only GDP, or all final demand purchases of new goods and services, but also all new goods and services produced as intermediate goods for use in further production. Real output is measured as a 2000 based chain-weighted Fisher index and is used for historical rate of growth comparisons. Real output on an industry basis does not add to their higher level aggregates because of chain weighting. See Charles Steindel, "Chain-weighting: The New Approach to Measuring GDP," Current Issues in Economics and Finance (Federal Reserve Board of New York, December 1995).
3 Providing a more accurate measure of the relative importance of aggregated sectors of the economy, current-dollars estimates were used in lieu of chain-weighted measures. See J. Steven Landefeld, Brent R. Moulton, and Cindy M. Vojtech, "Chained-Dollar Indexes: Issues, Tips on Their Use, and Upcoming Changes," Survey of Current Business, (U.S. Department of Commerce, November 2003), pp. 8–16.
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