BLS Daily Report

[Richardson_D <Richardson_D@xxxxxxx>]

BUREAU OF LABOR STATISTICS, FRIDAY, JANUARY 5, 2001

RELEASED TODAY:  Employment rose modestly in December, and the unemployment
rate was unchanged at 4.0 percent.  Total non-farm payroll employment
increased by 105,000, as gains in government and other service-producing
industries more than offset large declines in manufacturing and help supply
services.  Over the last 3 months of 2000, total payroll employment gains
averaged 77,000 compared with an average monthly gain of 187,000 during the
first 9 months of the year and 229,000 a month for all of 1999.  Average
hourly earnings increased by 5 cents in December. ...

New claims filed with state agencies for unemployment insurance benefits
climbed by 16,000 to a total of 375,000 during the week ended Dec. 30,
according to a report by the Employment and Training Administration of the
Department of Labor. The latest level of initial UI claims was the highest
in more than 2 years and coincides with recent public announcements of
layoffs in several industries. ...  Analysts expect the UI claims figures to
continue their gradual increase in coming weeks as the economy stays in a
slower growth mode.  ETA said the 4-week moving average of initial UI claims
rose by 5,250 to 352,250.  Economists look more closely at the 4-week
average because it smoothes the more volatile weekly totals.  A year
earlier, the 4-week average was 283,000. ...  (Daily Labor Report, page D-1;
Washington Post, page E2).

American companies announced 133,713 job cuts in December, more than triple
the number in November, according to a survey made by Challenger, Gray &
Christmas.  It was the highest number of job cut announcements recorded
since the survey began in 1993, and it was only the fourth time that the
number of job cuts totaled more than 100,000 in one month.  In another sign
of weakness in the labor market, the number of Americans filing for new
unemployment benefits climbed to its highest level in 2-1/2 years last week.
...  In a third report, orders for new goods from factories rebounded more
strongly than expected in November, led by big gains in orders for aircraft,
electrical equipment, and costly durable goods.  Factory orders rose 1.7
percent in November after falling 4 percent in October.  The November
increase was the biggest gain since a 2 percent rise in August and topped
analysts' estimates for a 1.3 percent rise.  But economists zeroed in on the
buildup in inventories.  Manufacturers' inventories rose 0.5 percent in
November, after posting a 0.7 percent gain in October. Analysts said the
inventory number showed that companies' stockpiles had continued to expand
as the economy -- and consumer demand -- slowed. ...  (New York Times, page
C5).

Nonmanufacturing business activity slowed in December, blunted by smaller
gains in employment, new orders, and inventories, according to the National
Association of Purchasing Management.  It reports that its nonmanufacturing
business index tumbled from 58.5 in November to 53.0 in December, a
reflection of the nation's slowing economic growth.  Another report showed
that inventory levels advanced at U.S. manufacturers in November, although
orders increased as well.  While the advance in orders suggests an eventual
rebound in capital investment, the ongoing rise in inventory levels portends
weak first-quarter growth as firms draw down existing stocks to meet demand,
economists say. ...  (Daily Labor Report, page A-2; Washington Post, page
E2).

Data compiled by the Bureau of National Affairs show deferred wage increases
payable in 2001 under current collective bargaining agreements produce a
weighted average wage increase of 3 percent.  By industry, the highest
weighted average increase deferred to 2001 -- 4.5 percent -- is found in
construction, followed by 3.7 percent in subways-buses-taxis.  The highest
median increase deferred to 2001 is found in construction with a 4.5 percent
gain, followed by airlines with a 3.5 percent rise. ...  (Daily Labor
Report, page A1).

After hoping in the 11th hour that tardy and postseason shoppers would give
them a final lift, the nation's merchants released the tally of December
sales and had to admit that they had a spectacularly unmerry holiday season.
Consumers snapped up scooters and calf-hugging leather boots, but otherwise
were impervious to everything -- even at deeply discounted prices.  Retail
sales at stores open at least a year rose one-tenth of 1 percent in the 5
weeks that ended the last week of December compared with the same period in
1999, according to the Goldman Sachs Index of Retail Sales.  That result was
the most anemic since March of 1995, when sales declined 0.1 percent
compared with the month a year earlier. ...  (New York Times, page
C1)_____After finally unwrapping holiday sales figures, most retailers
didn't find what they were hoping for.  Chains across the country reported
that winter storms and slower consumer spending pushed December sales below
already lowered expectations, making the recent holiday shopping season the
worse in at least 5 years. ...  (Wall Street Journal, page C1)

The big jump in medical care this year is not in medical commodities, which
includes drugs, but in medical services, where consumer prices have risen
4.7 percent in the past 12 months, says the "Economic Trends" feature in
Business Week (Jan. 8, page 30).  Although medical services includes visits
to doctors and dentists, it is charges for hospital services -- running 6.8
percent over last year -- that are really driving the surge in prices.  The
Labor Dept. reports that charges for hospital procedures to both consumers
and health insurers have risen across the board.  While nursing shortages
and greater use of expensive medical and information technology explain part
of the rise, it may also reflect the large number of hospital mergers that
have reduced competition in many localities. ...

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