Information industry jobs changes are mixed as economy re-opens from Covid-19

Three of the six information industries gained jobs in June and job losses slowed in the other three industries, according to preliminary labor department statistics.

Total employment in all six Information industries is still about 11 percent less than it was in February before stay home orders began. The six industries, which employed about 2.9 million people in February, had lost about 315,000 jobs by June.

However, the June jobs report is the first indication that some Information industries may be joining the recovery from the pandemic that began last month for sectors like Construction and Retail.

This post describes changes in employment for all six Information industries from June 2019-June 2020. The post does not include employment in selected occupations, which can be found in last month's post on Information jobs.

The first chart shows aggregate employment in all six industries.

The chart (above) shows monthly changes in Information sector employment. Data from the U.S. Bureau of Labor Statistics is seasonally adjusted to remove predictable influences such as seasonal changes or holiday hiring. This provides a more accurate estimate of changes from factors like the pandemic.

May and June employment statistics are preliminary and subject to revision.

The six Information industries employed more than 2.8 million people from June 2019-Feb. 2020. The industries lost jobs in March, April, and May before a small recovery in June.

June 2020 Information employment was still an estimated 315,000 jobs lower than in Feb. 2020, a decline of 10.9 percent. The Information sector employed an estimated 2.57 million people in June. 

Information is part of the private, nonfarm business sector which employed 129.7 million people in February 2020. The sector lost an estimated 21 million jobs in April, then added jobs in May and June. However, in June the sector was still down 13.1 million jobs since February, a decline of  10.2 percent.

Subsequent charts report employment in each of the six Information industries.

The second chart (above) shows employment in Data Processing, which includes hosting and providing data processing services.

Data Processing had the largest employment increase from May to June, adding an estimated 5,600 jobs. Employment is now 345,500, which is still below the 349,600 jobs in February.

Total job losses since February are estimated to be 4,100, a decrease of 1.2 percent.

The third chart (above) shows Motion Picture and Sound Recording, which includes the production and distribution of motion pictures and sound recordings.

This industry had the second largest employment gain from May to June, adding an estimated 2,600 jobs. However, employment was still far below the February figure of 456,000. 

Motion pictures and sound lost an estimated 243,700 jobs by June, or about 53.4 percent.

This unusually large decline may result from requirements that many people work in the same place when making a movie or a recording. Covid-19 makes physical proximity dangerous.

The fourth chart (above) shows Other Information Services, which includes search engines, internet-only publishing and broadcasting, and web sites that store and provide information.

This industry had the third largest employment gain from May to June, adding about 2,200 jobs.

Other Information jobs increased from February to March, before declining in April and May. Employment is still below the peak in March.

However, June's estimated employment figure is 1,200 higher than than the 354,400 jobs in February, an increase of 0.34 percent.

The fifth chart (above) shows Publishing, which includes newspapers, magazines, books, directories and software publishing. 

Job losses slowed in in June when the industry lost an estimated 600 jobs, the largest monthly loss in the Information sector.

Publishing had 770,000 jobs in February and lost an an estimated 30,700 jobs by June, a decrease of 3.9 percent.

The sixth chart (above) shows Telecommunications, which includes distribution and services for telephones, cable and satellite broadcasting, and internet access.

Employment losses in Telecommunications also slowed, an estimated decrease of 300 jobs in June was the second largest monthly loss in Information. 

The industry employed about 700,000 people in February. Telecommunications employment was down 12,400 June, an estimated decrease of 1.8 percent.

The seventh chart (above) shows Broadcasting, an industry that creates, acquires and distributes content via radio, television, cable and other subscription services.

Broadcasting employment decreased by an estimated 200 jobs in June, the smallest monthly loss in the Information sector.

The industry employed 263,300 people in February. Broadcasting lost an estimated 25,000 jobs by June, a decrease of 9.5 percent.

Comments

The pandemic continues to have the smallest effect on employment in Other Information Services, which may have two advantages. First, many employees can work from home. Second, there was increased demand for internet services as millions of people were ordered to stay home as much as possible. 

The June increase in Data Processing jobs is consistent with continued or increased demand for technology-based products and services. Job losses in Telecommunications continued in June, perhaps because the widespread loss of income during the pandemic reduced demand for telephone and cable services.

Motion Picture and Sound Recording remains the hardest hit industry despite the gain of 2,600 jobs in June. This change is too small to say if the large-scale production of movies, television programs and recordings is starting to resume.

Publishing and broadcasting job losses slowed, but these industries did not recover in June.

Employment changes in Information industries after Covid -19 shutdowns

Post updated June 11, 2020

More than 10 percent of all Information Industry jobs were lost by May, according to preliminary labor department statistics.

There are six Information industries which employed about 2.8 million people in February before stay home orders began. Jobs were lost in all of the six industries.

None of the Information industries gained jobs in May as some stay home orders were relaxed. There were job gains in other sectors such as Construction, Manufacturing, Financial activities, and Retail.

The Motion Picture and Sound Recording industry was hardest hit among Information industries -- more than half of its 456,000 jobs were gone by May.  Five other industries suffered job losses ranging from more than 8 percent in Broadcasting to 0.37 percent in Other Information Services. Other Information includes search engines and digital publishers and broadcasters.

This post describes changes in employment for all six Information industries from May 2019-May 2020. I also report employment in selected occupations as of May, 2019.

The first chart shows aggregate employment in all six industries.

The chart (above) shows monthly changes in Information sector employment. Data from the U.S. Bureau of Labor Statistics is seasonally adjusted to remove the influence of  predictable influences such as seasonal changes or holiday hiring. This provides a more accurate estimate of changes caused by factors like the pandemic.

April and May employment statistics are preliminary and subject to revision.

The six Information industries employed more than 2.8 million people from May 2019-Feb. 2020. The industries had lost an estimated 316,000 jobs by May, a decline of 10.9 percent.

Information is part of the private, nonfarm business sector which employed 129.7 million people in February 2020. The sector had lost an estimated 21 million jobs by April.  Some industries in this sector added jobs in May. But the entire sector was still down 17.9 million jobs since February, a decline of  13.8 percent.

Subsequent charts report employment in each of the six industries.

The second chart (above) shows Other Information Services, which includes search engines, internet-only publishing and broadcasting, and web sites that store and provide information.

Employment increased by 19,000 jobs from May 2019-Feb. 2020. Other Information employed 354,400 people in February. 

The industry added jobs in March. However, Other Information had lost an estimated 1,300 jobs by May, a decrease of 0.37 percent.

The table (below) reports 2019 employment in selected occupations. This is the most recent available data.

Employment in selected occupations is a rough indicator of the relative importance of specific jobs. However, these jobs may not be evenly distributed across the entire industry.

About 6 percent of Other Information employees were in Media occupations in 2019. Half were editors, and less than 2 percent were reporters

Editors may be employed at digital firms that do and do not produce original content. Reporters, however, are concentrated at a small number of digital news publications.

Computer jobs (not shown) are also reported for each industry to provide a comparison. Computer jobs and technology can be used to produce, distribute, and sell media and other information products.  

Computer jobs were 24.2 percent of employment in Other Information in 2019.

The third chart (above) shows Telecommunications, which includes distribution and services for telephones, cable and satellite broadcasting, and internet access.

Employment in Telecommunications decreased by about 16,000 jobs from May 2019-Feb. 2020. The industry employed about 700,000 people in February.

An estimated 12,800 jobs were lost by May, a decrease of 1.8 percent.

Media occupations were less than 1 percent of this industry in 2019. The industry does not produce original media content, so this is expected.

Computer jobs (not shown) accounted for 16.3 percent of employment in Telecommunications.

The fourth chart (above) shows Publishing, which includes newspapers, magazines, books, directories and software publishing. 

Employment in Publishing increased by about 12,000 people from May 2019-Feb. 2020. The industry had 770,000 jobs in February.

An estimated 28,000 jobs were lost by May, a decrease of 3.6 percent.

Media workers were about 10 percent of all Publishing jobs in 2019. Editors were almost 6 percent of industry jobs, probably because editors were employed by magazines and book publishers in addition to newspapers. Reporters were 2.5 percent of the industry, jobs that were concentrated in newspapers.

Computer occupations (not shown) accounted for 31 percent of Publishing jobs in 2019. Computer jobs may be more widely distributed than media jobs in this industry.

The fifth chart (above) shows Data Processing, which includes hosting and providing data processing services.

Employment increased by about 13,000 jobs from May 2019-Feb. 2020. Data Processing employed about 349,000 people in February.

An estimated 9,800 jobs were lost by May, a decrease of 2.8 percent.

Less than 1 percent of jobs were in Media occupations in 2019. This is another industry that does not produce media content.

Computer jobs (not shown) accounted for 40 percent of Data Processing employment. This is expected because the industry is defined by computing.

The sixth chart (above) shows Broadcasting, an industry that creates, acquires and distributes content via radio, television, cable and other subscription services.

Broadcasting employment decreased by about 4,000 jobs from May 2019-Feb. 2020. The industry employed 263,300 people in February.

Broadcasting lost an estimated 23,000 jobs by May, a decrease of 8.7 percent.

About 21 percent of Broadcasting jobs were in Media occupations in 2019. Broadcast Announcers and Disc Jockeys were 9 percent of all jobs, probably because they were employed by television and radio stations.

Reporters were about 6 percent of all jobs and camera operators and editors were 3.6 percent of jobs, possibly because these were concentrated at television stations.

Computer jobs (not shown) accounted for just 4.8 percent of Broadcasting employment in 2019.

The seventh chart (above) shows Motion Picture and Sound Recording, which includes the production and distribution of motion pictures and sound recordings.

Employment was steady at about 450,000 people until February 2020. 

The industry lost an estimated 240,900 jobs by May, or about 52.7 percent.

This unusually large decline may result from collaboration between many people in the same place when making a movie or a recording. Covid-19 makes physical proximity dangerous.

Only 3.5 percent of Motion Picture and Sound jobs were in Media occupations in 2019.

Camera operators and editors were listed as a major category, accounting for another 3.5 percent of all jobs. There were more than twice as many camera operators and editors, 27,560, as in Broadcasting with 9,690. 

Computer jobs (not shown) were just 1.5 percent of employment in Motion Pictures and Sound.

Comments

Employment changes during the pandemic are probably influenced by whether employees can keep working, how much demand and revenue still exists for the industry's products, and long-term employment trends.

The pandemic is having the smallest effect on Other Information Services. This may be because employees can work from home. This may also result from increased demand for internet services when millions of people were ordered to stay home as much as possible. Online advertising is generally cheaper than ads in Broadcasting or Publishing, so increased demand also means the industry can continue selling ads.

Smaller adverse effects on employment also appear in other industries where technology may allow people to work from home, such as Data Processing and Telecommunications. However, both industries employ thousands of sales agents who may be unable to work. Telecommunications demand for cell phone services may also be affected if customers are losing their jobs and incomes.

Publishing jobs losses are increasing. Some employees may be able to work from home such as book and magazine editors and computer employees. Employment in Publishing as a whole was also increasing before the pandemic.

However, some Publishing sectors such as newspapers had decreasing employment before the pandemic. The initial pandemic response from some large newspaper companies included cutting hours worked and using furloughs to avoid layoffs. But these are interim measures that might not be enough to stave off layoffs.

The largest adverse effects appear to be industries where workers must gather in the same location to produce news and entertainment products. Broadcasting is also losing advertising revenue because large advertisers are reducing spending as consumers buy fewer advertised products.

Most dramatically, Motion Picture and Sound Recording jobs vanished as the production of movies and television programs shut down.

Glimpse of Tumblr is reminder new media business model isn't generating many jobs

There is still a lot we don’t know about the new media business model, so even a glimpse of the model’s inner workings can be valuable. A New York Times article about Tumblr offers such a glimpse, which shows the company is unlikely to generate a significant number of media jobs.

 

There is a great deal of fascination about companies like Tumblr, a popular blogging platform that Yahoo purchased last year for a reported $1.1 billion, mostly cash. Tumblr wasn’t profitable, but Yahoo did acquire millions of Tumblr bloggers to add to Yahoo’s user base. Yahoo is developing ways to distribute advertising aimed at Tumblr users.

 

Tumblr, like other new media companies, has some superficial similarities to traditional media companies. Both new and traditional media publish content that attracts an audience, then sell advertisers access to that audience. But the similarities end there.

 

New media companies like Tumblr don’t pay for the content - blog posts (including pornography) – they need to exist. Traditional media companies do pay for content, which increases their production costs.

 

New media companies like Tumblr also rely on automation -- computers and computer software --to provide a platform for the production and distribution of the content they use. Traditional media companies cannot easily develop similar platforms because millions of potential users have already selected new media platforms for blogging and other Internet activities.

 

The new media business model relies on free content and automation to keep costs low, otherwise these companies would go out of business. That is because new media companies generate very small per-unit revenue from Internet advertising. These companies must keep their per-unit costs low if they want to generate enough money to survive.

 

The Times article reports that Tumblr doubled its staff, but still employs only 220 people. As of today, Tumblr claims it has 185 million blogs. That is about 841,000 blogs for each employee. If Tumblr expands to 500 employees, it will have 370,000 blogs for each employee. Even if activity on the blogs varies, these numbers show the kind of astonishing productivity that new media companies enjoy because of their reliance on automation.

 

The low per-unit revenue at new media companies means they must also attract a very large number of users before they can generate enough profit to justify the high values that new media companies receive from financial markets. Traditional media companies have much lower values in financial markets, but traditional media still generate high enough revenue-per-unit to survive without an audience in the hundreds of millions.

 

For example, Tumblr’s enormous number of blogs means it has to generate average revenue-per-blog of just $5.95 to match its $1.1 billion purchase price.

 

However, Tumblr still isn’t generating enough revenue to develop “a working business model” according to The Times. (Yahoo hasn’t broken out figures for Tumblr in Yahoo’s most recent financial reports).

 

Yahoo is still trying to develop advertising that won’t disturb the Tumblr ethos, which rejects advertising. I suspect Yahoo is also developing ways to generate revenue from data about Tumblr users even though Yahoo only requires an e-mail address to identify each Tumblr user.

 

This suggests one more thing the glimpse tell us about the new media business model. Small per-unit revenue means these companies require enormous numbers of users to generate enough revenue to become profitable. But sometimes, even a large number of users and a very small number of employees won’t be enough for a new media company to become profitable.

Does economics overlook the logic of communication?

Eric Rothenbuhler of Ohio University wonders if economic logic falls a bit short when it comes to understanding what drives success for media companies.  Rothenbuhler, whose research focuses on the nature of communication, writes in response to yesterday’s post:

Steve Wildman is right, of course, about the economic logic of servers versus channels and storage versus programming.  But media companies that forget they are communicators, that try to operate by economic logic alone, are doomed.

The shift from programming channels to storing stuff on servers is analogous to the shift from being in the communication business to being in retail, or wholesale, or just warehousing. The relationship with the audience member goes away and the media business becomes just a supplier of things people choose—it might as well be Sears.

The penny press was programming, not story storage.  Top 40 radio was programming, not juke boxes.  Even silly stuff like NBC's "must see TV" Thursday night line up some years ago, worked because it was programming that pulled audiences in and held them, it gave them something to anticipate before they watched it and something to talk about after—it created an event in the everyday flow of their life.

The greatest successes in media businesses are always based on communication innovations, on programming that attracts and holds audience members because it draws them into a communicative relationship.

That's what media managers ought to be thinking about today - the logic of communication. Be successful at that, and the money will follow.

Eric co-authored a seminal article in the field of media economics when he was a master’s student at Ohio State.  There was a very nice moment at the conference when he and lead author John Dimmick were together again.

Dimmick (r) & Rothenbuhler (l) at the conference.  In 1984 they published "The Theory of the Niche: Quantifying Competition Among Media Industries," Journal of Communication, 34(1), 103-119.

Creating the Future: Managing Media in the Digital Age

Readers of this blog are invited to a Sept. 7 conference at The Scripps College of Communication  to discuss the challenges and opportunities for firms operating in fast-moving media markets.

Richard A. Boehne, president and chief executive officer of The E.W. Scripps Company, will be the keynote speaker for Creating the Future: Managing Media in the Digital Age.  He will be joined by top executives from media firms in Ohio and West Virginia and leading scholars from four universities.

For registration and other information, visit our conference website: http://scripps.publishpath.com/creating-the-future-2011

Partial list of speakers:

Richard A. Boehne, president and chief executive officer, The E.W. Scripps Company.

Margaret Buchanan, president and publisher, Cincinnati Enquirer

Bray Cary, president and chief executive officer, West Virginia Media

Richard Dix, publisher, Kent-Ravenna Record Courier

Lynn Gellermann, executive director, TechGROWTH Ohio, managing partner, Adena Ventures

Anne Hoag, associate professor in the Department of Telecommunications, College of Communications, Penn State University

C. Ann Hollifield, Telecommunications Department head, Grady College of Journalism and Mass Communication, The University of Georgia

Stephen Lacy, associate dean for graduate studies, College of Communication Arts and Sciences, Michigan State University

Phil Pikelny, vice president Dispatch Digital and chief marketing officer The Dispatch Printing Co., Columbus

Nita Rollins, Ph.D., Futurist, Resource Interactive.

Scott Titsworth, Interim Dean, Scripps College of Communication, Ohio University.

Steve Wildman, James H. Quello professor of telecommunication studies, College of Communication Arts and Sciences, Michigan State University

Joseph Zerbey, president and general manager, The Toledo Blade

Contact me if you have any questions by e-mailing: martinh1@ohio.edu