BLS Daily Report

[Richardson_D <Richardson_D@xxxxxxx>]

BLS DAILY REPORT, THURSDAY, DECEMBER 9, 1999

RELEASED TODAY: The U.S. Import Price Index increased 0.5 percent in
November.  The increase--the fifth in a row--was the same as in October.
Export prices were up 0.2 percent in November, after rising 0.3 percent in
October. ...

Both the number of layoff events and the number of workers affected by
extended mass layoffs decreased in the third quarter of 1999, compared with
the same period a year earlier, according to figures released by BLS.  BLS
reported that one reason for the decline was that layoff totals in the third
quarter of 1998 were boosted by strike-related plant shutdowns in the
transportation equipment and electronic equipment industries. ...  (Daily
Labor Report, page D-1).

Moderate to strong economic growth persisted in October and November
throughout the United States, according to the Federal Reserve's most recent
survey of current economic conditions.  The Fed's latest "beige book," which
summarizes economic conditions in each of its 12 banking districts, reported
heightened consumer spending over the Thanksgiving weekend following earlier
sluggish sales, which were blamed on unseasonably warm weather.  A tight
labor market affects employers throughout the United States, although wage
increases generally did not accelerate as a result, the report said.  On
average, the Fed said wages increased 3 to 10 percent, on an annual basis.
Wage increases were concentrated in the Richmond and Atlanta regions. ...
(Daily Labor Report, page D-8)_____The U.S. economy keeps steaming ahead,
while pressures on wages and prices remain under control.  Most of the Fed's
districts experienced "continued moderate to strong" expansion in October
and November.  Labor markets remained tight in all districts, but the pace
of wage and salary increases generally "did not appear to be accelerating,"
the report said.  Prices of retail and industrial goods also were holding
steady, although "prices of some goods have been on the rise," the report
said. ...  (Wall Street Journal, page A2; Washington Post, page E3).

Supported by more optimistic expectations for consumer spending and business
investment, business economists have turned more bullish on the outlook for
next year and now expect growth of 3.2 percent, the National Association for
Business Economics said.  The forecast for gross domestic product rising 3.2
percent next year is up from 2.7 percent forecast in the previous survey,
taken in September.  In this new poll, taken in late November, economists
also revised up slightly their GDP estimates for this year to 3.9 percent
from 3.8 percent. ...  (Daily Labor Report, page A-9).

Trucking companies are about to raise the price of moving goods. Some of the
country's largest trucking outfits are increasing rates by an average of 5
to 6 percent, due to higher fuel prices and a shortage of drivers.  And the
strong economy is boosting the chances that many of their customers will pay
the higher rates. ...  (Wall Street Journal, page B6).

One of the best things about the current prosperity -- the remarkably low
unemployment rate -- has a decidedly low-tech origin, according to an
editorial in yesterday's Washington Post.  According to professors Lawrence
Katz of Harvard and Alan Krueger of Stanford, the "hidden hero" is the
temporary employment agency. ...  The professors note that, as of last year,
unemployment was 0.8 percentage points lower than it was in 1989, at the
height of the previous business cycle.  They observe that a quarter of that
improvement comes from demographic shifts:  Young workers tend to be in and
out of jobs, and young workers make up a smaller percentage of the work
force than they did 10 years ago.  A further quarter of the improvement
comes from the ... expansion of prisons:  Thousands of unskilled people who
might have been unemployed are not counted as such because they have been
locked away. ...  What might have produced the other half of the reduction?
Katz and Krueger consider the possibility that this could have come from
government intervention, such as job-search workshops, counseling, and other
help as part of the UI system. ...  But the authors calculate that this
reduced unemployment by 0.01 to 0.06 percentage points.  Then the professors
deliver their punch line.  Since the 1980s, the army of temporary employment
agencies has grown markedly:  Temp workers constituted 2.2 percent of the
work force last year, up from 1.1 percent a decade ago.  By making it easier
for firms to find potential employees, temp agencies ensure that empty jobs
are filled more rapidly.  Moreover, the increased ease of new hiring
discourages those with jobs from pushing wage demands as aggressively as
they used to in flush times.  Taken together, these two effects seem to
account for a 0.4 percent fall in unemployment, or half the total
improvement. ...

DUE OUT FRIDAY: Producer Price Indexes -- November 1999

<<application/ms-tnef>>