Appended Note 2-5 Decline of Labor Productivity of Non-manufacturing Industries and Its Effect on Manufacturing Industries

We can calculate a change in output price in non-manufacturing industries by changing only the labor input coefficient of non-manufacturing industries in the "CY 1990 SNA Interindustry-Relations Table (24 sectors)" (Cabinet Office) in line with the growth rate of labor productivity (output / number of workers) in non-manufacturing industries in the "National Accounts (FY 1990 standard)" (Cabinet Office) for the 1980s and 1990s (1990~1998). Then, we estimated the difference in the effect that a price change in non-manufacturing industries in each case will have on output price in manufacturing industries through intermediate input.

Moreover, we calculated the difference in profitability in the case where the effect of input in non-manufacturing industries is not reflected in the prices of products by applying the estimate result in each case to cost of sales costs in manufacturing industries in the Yearly Report of Incorporated Enterprises Statistics (Ministry of Finance).