An analysis of staffing efficiency in US manufacturing: 1983 and 1989

A DEA framework is used to examine changes in administrative employment in US manufacturing industries between 1983 and 1989, using data collected by the US Department of Labor. Among other findings, the analysis suggests that production technology is an important factor in explaining inter-industry differences in administrative staffing. In addition, ‘best practice’ staffing efficiencies for Batch industries are shown to hold a distinct (and statistically significant) advantage over that for Line industries. On related issues, this research uncovers no evidence of the ‘dramatic decreases’ in overhead staffing that were suggested in the popular business press during this time period. Clear structural differences in administrative staffing intensities, however, are noted with respect to manufacturing production technology. In their usage of overhead staff, Batch industries tend to be more ‘professional-worker’ intensive, while Line industries are relatively more ‘non-professional-worker’ intensive. These patterns hold up over time and are statistically confirmed in an analysis of DEA ‘cones’.