Economic Cost of 12 Days of Christmas

PNC Bank’s Analysts have a great piece examining the economic costs and changes of the 12 Days of Christmas songs. It’s nice to see analysts who have fun with their chosen professions, with style and humor.

PITTSBURGH, Dec. 8, 2003 – While stiff import competition is driving deeper discounts on merchandise sold in the United States, skilled labor cost is on the rise, resulting in a 16 percent increase in this year’s PNC Advisors Christmas Price Index – the biggest jump the Index has seen in its 19-year history. 

Some other gems from the report include:

Indeed, the cost of the five gold rings dropped by 5.6 percent, and the pear tree is down a full 28.6 percent from last year.  However, these discounts were offset by the dancers, pipers and drummers who have seen significant increases in the cost of their services over 2002.

“The Index reflects the broader trend of productivity growth in the U.S. economy that has driven prices lower on goods while allowing prices for services to rise modestly,” said Jeff Kleintop, chief investment strategist for PNC Advisors. “Whereas in the mid-1980s the cost of the goods in the song dominated the Index, the trend over time has been toward lower goods prices, such as the pear tree, and higher prices for skilled labor, such as the pipers,” he said. 

“The abundance of cheap labor in countries such as China have contributed toward increased pressure on U.S. manufacturers to outsource their unskilled labor overseas, and evolve toward higher-skilled areas, to maintain profitability. Unfortunately, the unskilled Maids haven’t managed an increase in price for their services in many years,” he added.

Maybe the Lords a Leaping union is going to have to reconsider their share of the pie from the Christmas package.