US economic growth can be divided into two parts: more hours worked, or more productivity per hour worked. In the past, the US labor force has been rising over time: the US labor force totaled 107 million people in 1980, 142 million in 2000, and was up to 171 million this year. However, after several decades of falling birthrates and population aging, US workforce growth has been slowing down. Future US economic growth will need to rely more heavily on higher productivity per hour–a change that is already underway.
Nathan Modica of the US Bureau of Labor Statistics offers some discussion in “Industry growth patterns: a closer look at output, productivity, and hours worked from 1990 to 2024” (Monthly Labor Review, December 2025).
Here’s an overall economy-wide view. Notice, for example, that productivity growth in the last six years or so (red bars) isn’t much different from the 1990s, but the annual gain in hours worked is much smaller.
Here’s a hours and output-per-hour breakdown by major sectors of the economy. Most of these industries had little change in hours worked from 1990-2024, and some had declining hours worked. The main exception where more hours were worked was in “Accommodation and food services.” Elsewhere, all or nearly all of the output gains are from higher productivity measured by output-per-hour, not more hours worked.
Modica offers a number of industry-level breakdowns. Here’s one for a subset of the “Accomodation and food services” category, broken down into “Limited service eating places” and “Full service restaurants.” The interesting shift here is that during the 1990s and into the 2000s, most of the output gains these businesses can be traced to more hours worked, with only modest changes in productivity. But since the pandemic, hours worked is barely up in Limited-service eating places and down substantially in Full-service restaurants, while productivity gains now represent the lion’s share of output growth in both categories.
The reason behind this change seems to be a lasting effect that was jump-started by the COVID pandemic: that is, more widespread use of take-out ordering.
The pandemic seems to have hastened the adoption of newer business practices and technologies in both restaurant industries, which could have boosted measured productivity in either industry. A survey from a trade association indicated that the shift to off-premises revenues accelerated during 2020 in all restaurant types. Later surveys confirmed that off-premises consumption in restaurants was still higher in 2021 than before the pandemic, concurrent with the drop in on-site dining. Even well after most pandemic restrictions loosened, off-premises dining remained higher in 2023 than in 2019 throughout the restaurant trade.
Complementary to the increase in off-site consumption was the expanded use of digital technologies like ordering, payments, and delivery-management online or with mobile apps. Again, this does not seem to be merely a short-term reaction to pandemic conditions. Market survey data from 2023 suggest that many full-service restaurant operators introduced delivery service during the pandemic—including many fine-dining establishments—and that most of those who introduced it planned to retain it.
