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Ecommerce Jobs Show Fast-Rising Real Wages and Productivity

By / 1.16.2017

Ecommerce jobs  for  production and nonsupervisory workers are paid on average about 25% more than production and nonsupervisory jobs for the private sector as a whole.  That’s according to BLS data.

Economic theory suggests that industries with faster productivity growth should have faster real wage growth. That’s exactly what we see in the case of the electronic shopping industry.

The figure below compares labor productivity growth in the “electronic shopping and mail order” industry (NAICS code 45411)  with productivity growth in retailing as a whole.  We can see an enormous difference. From 2000 to 2015, ecommerce productivity rose at an annual rate of 8.7% annually, compared to 2.6% for retailing as a whole.

ecommerceproductivity

 

This difference in productivity growth is reflected in the growth of real wages. The figure below compares average hourly wages, in 2016 dollars, for production and nonsupervisory workers in three industries or sector: electronic shopping, all retail trade, and all private sector workers. We see that production and nonsupervisory workers in electronic shopping earned an average wage of $25 per hour. That’s not bad at all–it’s about 25% higher than average hourly wages for all production and nonsupervisory workers, and about 80% higher than average hourly wages for all retail workers.

Depending how we define middle-class, these figures imply that production and nonsupervisory jobs in ecommerce

 

ecommercewages

 

What about jobs? Since 2007, the number of retail jobs has risen by roughly 420K, while the number of “electronic shopping” jobs has risen by 140K. And that latter number is most likely an underestimate, because it doesn’t include ecommerce jobs that are part of larger retail establishments. So ecommerce is a major driver of good job creation in the retail sector.

The implication is that as more and more retail jobs shift to ecommerce,  both wages and productivity will rise.