Employment Trends - The Sectors - The Last 20 Years

The growth in the services producing sector is the striking feature of this graph, showing the sectors of the U.S. economy for three decades in thousands of employees. The services producing sector nearly doubled in the 1980 to 2000 period, employing 48.5 million people in 1980 and 85.4 million in 2000 — essentially absorbing all of the growth in employment in this 20-year period. Total employment grew by 40.7 million, services employment by 36.9 million, thus the latter accounted for just under 91% of all new jobs.

The services producing sector is made up of transportation, utilities; finance, insurance, and real estate; wholesale and retail trade; and the services sector more narrowly construed. This latter portion includes everything from doctors and nurses to museum curators, from lawyers to filling-station attendants, from consultants to pet groomers. In a panel in this series, we shall look a little closer at these components.

Note that agricultural employment has declined and that the goods producing sector has remained essentially flat. The goods producing sector consists of mining, construction, and manufacturing. Yet population in this period increased by 49.8 million, from 226.3 million in 1980 to 276.1 million in 2000. This means that roughly the same number of people are now providing essentials — food, shelter, and products — as they did 20 years before — to a population that has increased by the addition of more people than live in Spain and Denmark combined. This ignores import-export dynamics and globalization, but it was, in good part, possible only because of tremendous improvements in productivity, which has a chapter of its own later in this book.

The governmental sector has increased in total employment by 3.8 million people (about 21%). This increase directly reflects the growth of the educational establishment, which is geared to population growth. Population increased 22% in the same period. We shall present more detail on the government sector later.

The following table shows the shares of total employment held by each of the sectors. The sectors are also divided into Private Sector and Government and into Profit-making and Not-for-profit segments.

Percent of Total Employment and Change

	1980	1990	2000	Change 80-00	Change 90-00
Private Sector	80.9	82.3	83.8	2.9	1.5
Agriculture	3.5	2.8	2.4	-1.1	-0.4
Goods producing	26.8	21.7	18.8	-7.9	-2.9
Services producing	50.6	57.7	62.5	11.9	4.8
Government	19.1	17.7	16.2	-2.9	-1.5
Federal civilian	3.0	2.7	2.0	-1.0	-0.7
Federal military	2.1	1.8	1.1	-1.1	-0.7
State government	3.8	3.8	3.5	-0.3	-0.2
Local government	10.2	9.5	9.6	-0.6	0.1
Profit-making		64.2	69.6		5.4
Not-for-profit		35.8	30.4		-5.4
Government	19.1	17.7	16.2		-1.5
Private tax-exempt		18.1	14.2		-3.9

We are growing more private and more profit-making. This pattern may change after the terrorist attacks of September 11, 2001, but this was the pattern evolving until that time. Within the private sector, gains in share have been posted by the services producing segment, mostly at the expense of goods producing activities. In the government sector, all elements have lost share except local government. Its minute gain is due to elementary and secondary education. Losses by the not-for-profit sector are greatest in the privately managed portion; losses in share by the government have been less.

Sources: U.S. Bureau of Labor Statistics. "Employees on nonfarm payrolls by major industry, 1950 to date." Online. Available: http://www.bls.gov/ces/home.htm. January 2002. U.S. Bureau of the Census. Statistical Abstract of the United States, 2000. Table 672, p. 420, for data on agricultural employment. Government totals include data obtained from the U.S. Department of Defense, and published in Statistical Abstract, 2000, Table 579, p. 168. The military on active duty for the year 2000, included but not shown, was estimated from 1998 data by the editors.