U.S. Workplaces Have Never Been Safer but Suicides Increased During the 2008-2009 Recession

As we approach the Labor Day weekend it is interesting to examine the latest data on workplace violence and workplace safety.  The Department of Labor just released preliminary figures for fatal work injuries in 2012.  The good news is that workplaces in the U.S. have never been safer.  Workplace fatalities are down and workplace violence is lower than it has been in decades.  The most distressing pattern in recent data has been the increase in suicides in the workplace, apparently a result of the 2008-2009 recession.

The workplace fatal injury data for 2012 released last week will be revised upward when the final fatality rates are recorded.  If the upward revisions are consistent with recent years, the rate of fatal work injuries will be about 3.3 per 100,000 full-time equivalent employees, the lowest rate since the BLS began reporting these figures in 1992.  As the following chart shows, the workplace fatality rate is 36.5% lower than it was two decades ago.


Transportation accidents continue to be the most common cause of a workplace fatality and account for 41% of all fatalities on the job.  Workplace violence is the second most common cause of fatalities and account for an additional 17.5% of deaths.  Within the workplace violence category, there are more than twice as many homicides as suicides.

Workplace deaths from homicides and transportation accidents have been trending down over the past 20 years.  Transportation accidents have been declining by about 1.4% per year and homicides at work have been declining by about 4.3% per year.  As the following charts indicate, over the past decade the drop in both homicides and motor vehicle accidents has been more pronounced in the workplace than in the general population.  (I have normalized the fatality rates per adult to be 100 in 1992 for all categories of causes of death.)



Suicides in the workplace declined slightly from 1992 to 2002 following the pattern in the general population as the following chart shows.  More recently suicides in the workplace declined more sharply 2002 to 2007 but then increased rapidly during the 2008-2009 recession.


The following chart shows the relative increase in the number of suicides at work during the recession and the declining trend  in the number of transportation accidents and homicides in the workplace over the past two decades.  (I normalize the number of workplace fatalities to be 100 for each category in 1992.)


A simple statistical analysis suggests that there were about 153 more suicides in workplaces as the economy struggled from 2008 to 2010.  At the same time the drop in economic activity meant fewer fatal transportation accidents.  My rough calculation suggests that there were 749 fewer deaths from traffic and transportation accidents from 2008 to 2010 than there would have been if the economy had continued to grow.  In general the recession reduced fatal workplace accidents.

Despite the good news that workplaces in the U.S. are safer than ever, Secretary of Labor Tom Perez is not satisfied.  He issued a statement last week that “no worker should lose their life for a paycheck.”  I am sure that Secretary Perez also would like no U.S. resident to lose their life in any accident, whether they are being paid for their time or not, but that is an unrealistic goal.  Mr. Perez also finds the increase in fatalities in the oil and gas extraction industry unacceptable.  Clearly, many of the men and women who work in oil and gas extraction are risking their lives every day they go to work, but the 138 deaths in this industry last year need to be put into perspective.  Over the past two years fatalities in oil and gas extraction averaged 125 per year, or 22% higher than in the previous 8 years.   This increase is smaller than the 27% increase in employment in the industry over the same period.

As more people find jobs and shift from part-time work to full-time work, we can expect workplace fatalities to increase in many industries and sectors.  This does not mean that workplaces are becoming less safe – in fact workplaces are safer than ever.  In 2012 there were about 36.5% fewer workplace fatalities per full-time equivalent employee than just 20 years ago.  The downside is that some of the increase in safety has been achieved by outsourcing riskier jobs and replacing workers with machines.  As is the case in many economic issues labor faces a tradeoff between workplace safety and employment security.  If organized labor demands exceedingly high levels of safety in U.S. workplaces the U.S. will be more likely to lose jobs to foreign competitors with more lax safety standards and will be more likely to replace workers with machines and robots.

Pay and Productivity

On Labor Day weekend in 2012 labor’s share of national income is lower than it has been since World War II, and there is a widening gap between growth in output per hour and labor compensation.  There is no doubt that technological change and globalization have contributed to these trends.  The clearest path to mitigating these trends is better education and training programs to prepare workers for a highly competitive and dynamic global labor market.

Worker productivity is a key factor in determining pay.  In a competitive economy a worker’s wage equals the additional revenue generated by one more unit of labor services.  A worker who costs twice as much as another must be twice as productive, at the margin, in order to keep his/her job.  The key is worker productivity at the margin, which is difficult to measure.  The Bureau of Labor Statistics (BLS) reports average output per hour (which is higher than marginal output per hour) and has shown that wages and average productivity have diverged over the past two decades.

This week the BLS released productivity data for detailed retail trade industries in 2011.  Two of the industry leaders in productivity gains between 2010 and 2011 were book stores and florists.  Output per hour worked increased by 13.4% in book stores and by 20.6% in florists from 2010 to 2011.  A naïve interpretation of these data would lead to the prediction that wages should rise sharply for employees of book stores and florists.

Productivity in book stores and florists has risen because management has developed methods to sell more with fewer employees.  Employment in book stores is less than half of what it was in 2003 and employment in florists is down 43% since 2003.  The worker productivity gains at these retailers are unlikely to be the result of more productive and skilled employees, but instead due to efficiency gains.  The revenue generated by an additional hour of a worker’s time may well be about the same as it was a decade ago, with fewer workers in the store.  In this situation an increase in average worker productivity per hour doesn’t translate into wage gains.

Technological change and globalization have weakened the demand for labor in goods producing industries for decades.  Over the past decade gains in information technology have weakened demand for workers in the service and retail sectors as well.  These trends present a challenge for the labor movement in the U.S. on this Labor Day weekend.

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