An econometric model explaining changes in food and department store employment from 1948 through 1954 and from 1954 through 1958. The paper shows the importance of the weighted change in the variable ratio of labor to sales for central city equations. It illustrates the importance of technological change, innovation, and other shifts in the production function in determining levels of employment. It also shows that changes in productivity are not independent of changes in employment and new investment. In rapidly growing areas, changes in employment and new investment appear to influence productivity more than autonomous changes in the latter influence the former.