BLS Daily Report

[Richardson_D <Richardson_D@xxxxxxx>]

> BUREAU OF LABOR STATISTICS, DAILY REPORT, MONDAY, NOVEMBER 5, 2001:
>
> The U.S. jobless rate surged to 5.4 percent last month, the highest level
> in almost 5 years, as companies laid off hundreds of thousands of workers
> in the wake of the September 11 terrorist attacks, said the Labor
> Department.  The rate jumped from 4.9 percent in September, for the
> biggest monthly increase since the recession of 1980.  As the economy
> deteriorated, jobless rates rose significantly for every major demographic
> group: adult men and women, teens, whites, blacks, and persons of Hispanic
> origin.  The ranks of the unemployed soared to 7.7 million from 7 million
> (John M. Berry, The Washington Post, November 3, page 1; Associated Press,
> http://www.usatoday.com/money.economy/2001-11-02-jobs.htm).
>
> Over 400,000 Americans lost jobs last month, the most for a single month
> in more than 2 decades, as businesses responded to a deteriorating economy
> with a surge in layoffs.  The question among analysts is no longer whether
> the United States is in a recession, but how deep it will be and how many
> months will pass before jobs become plentiful again.  Roughly a quarter of
> the lost jobs were a direct result of the terrorist attacks on September
> 11, according to Thomas Nardone, chief of the division in the Bureau of
> Labor Statistics that compiles the monthly job numbers. The attacks
> apparently dashed the hopes of many executives for a quick recovery after
> a mild recession, and they stepped up layoffs to prepare for hard times.
> Mr. Nardone said the terrorism triggered job cuts at airlines, travel
> agencies, hotels, restaurants, and car rental agencies that exceeded by
> 100,000 the average declines in those industries in recent months. "People
> are asking "What would the economy look like if the terrorist attacks had
> not occurred," Mr. Nardone said.  "But they did occur and that has had an
> impact on people's decisions that continues to multiply the damage to the
> economy." Part-time work also surged among people who either wanted
> full-time jobs and could not get them, or had their hours cut back by
> their employers against their wishes.  That number jumped 1.1 million in
> September and October, to a total of 4.5 million.  "That is a very big
> number," Mr. Nardone said.  "The demand for labor is clearly contracting"
> (Louis Uchitelle, The New York Times, November 3, page 1).
>
> The services sector, which has been America's main engine of job creation
> since World War II, has been dealt a powerful blow by the events of
> September 11.  Of the 619,000 jobs that disappeared from September to
> October, 111,000 were counted by the government as service positions.  The
> decline was the sector's largest since the Bureau of Labor Statistics
> began keeping track.  Travel-related business in particular cut their
> staffs as the terrorist attacks made Americans reluctant to fly.  The
> number of jobs in hotels fell by 46,000, compared with an average monthly
> decline of 5,000 from July to September. The number of jobs defined as
> "auto services" -- a category that includes jobs at car rental agencies
> and in parking lots -- fell by 13,000.  Normally the category does not
> change significantly from month to month.  John Stinson, a labor economist
> at the Bureau of Labor Statistics, said the line separating service and
> manufacturing jobs has been blurred in recent years by the sharp increase
> in the number of contingency workers known as temps.  Such workers are
> officially defined as service employees, because they are hired and paid
> by temporary agencies, Mr. Stinson said.  But many temps are sent to
> perform manufacturing jobs by their agencies. "There has been a lot of
> weakness in the temporary help agencies," Mr. Stinson said.  "It's not
> just a one-month thing at all.  A lot of it is related to manufacturing"
> (Mary Williams Walsh, The New York Times, November 3, page C3).
>
> The vast U.S. services sector shrank sharply in October, according to a
> report that cemented a widespread view that the world's largest economy
> slipped into a recession after the September 11 attacks.  The National
> Association of Purchasing Management said Monday its nonmanufacturing
> business activity index fell to its lowest level in the survey's 4-year
> history, plunging to 40.6 percent from 50.2 percent.  Economists had
> expected a dip to 45.9 percent. A reading below 50 indicates contracting
> activity in the services sector, which includes everything from
> transportation to legal and financial services.  NAPM's manufacturing
> index, which measures less than one-fifth of overall economic activity,
> has been mired below 50 percent for the past 15 months.  NAPM said 14
> sectors of the
> contracted while the health services sector did not.  Health services was
> also the only services industry that reported price increases (Reuters,
> http://www.usatoday.com/money/economy/2001-11-05-napm-services.htm).
>
> For the nation's job hunters, it's a reversal of fortune as striking as
> the Nasdaq Stock Market's.  In just 13 months, the U.S. unemployment rate
> has soared from 3.9 percent, the lowest in a generation, to a 5-year high
> of 5.4 percent.  A labor market that not so long ago turned unskilled
> workers into middle managers now is leaving even professional jobless or
> scrounging for fast-food jobs (The Wall Street Journal, page 1).
>
> Grim economic data poured fourth last week, and Friday's jobs report
> capped it off.  As the ranks of the "have nots" get larger, their
> purchasing power evaporates. That's important but, granted, obvious.  Less
> obvious is this:  The remaining 94.6 percent of the work force is losing
> some of its purchasing power, too.  Economists have long warned that
> consumer spending would erode if unemployment suddenly shot up, as the
> "fear factor" of seeing the other guy unemployed would prompt consumers to
> pull back.  But that's only part of the story.  In the months ahead, a
> growing number of workers will actually see their incomes decline -- and
> the jolt of spending could be severe (Bernard Wysocki, Jr., "The Outlook"
> feature of The Wall Street Journal, page 1).
>
> Although the use of unpaid leave under the Family and Medical Leave Act
> rose during the late 1990s, an increasing proportion of employees said
> they were financially constrained from using time off under FMLA,
> according to an analysis by Jane Waldfogel of Columbia University.  Her
> study looks at two surveys funded by the Labor Department, pertaining to
> leave taken in 2000. The pattern of usage changed during the late 1990s,
> as more employees took time off to care for newborns or older children, or
> for other family members rather than for reasons related to their own
> health, Waldfogel found in "Family and Medical Leave:  Evidence from the
> 2000 Survey" published in the September issue of the Bureau of Labor
> Statistics' "Monthly Labor Review" (Daily Labor Report, November 1, page
> A1, E-1).
>
> Retail gas prices fell nearly 7 cents nationwide in the past 2 weeks, for
> a total drop of more than 28 cents since September 7.  The average retail
> price of a gallon of gasoline, including all grades and taxes, was $1.28
> on Friday, down 6.61 cents from October 19, according to the Lundberg
> Survey of about 6,000 stations nationwide.  Gas cost $1.56 a gallon
> September 7 (Associated Press,
> http://www.nandotimes.com/business/story/164004p-1563764c.html).
>
> What already was a global economic slowdown has been gathering momentum
> since September 11, dashing hopes for a quick U.S. economic turnaround and
> raising the specter of worldwide recession.  J.S. Morgan Chase & Co. now
> forecasts that global economic growth will barely exceed 1 percent this
> year and the next, which would be the worse performance in 20 years
> (Steven Pearlstein, The Washington Post, November 4, page 1).
>
> The decline in orders to U.S. factories in September marked the fourth
> consecutive monthly drop, and shows the manufacturing sector of the
> economy remains in a recession.  Factory orders fell 5.8 percent after a
> revised 0.1 percent decline in August, the Department of Commerce reports.
> September durable goods, which were reported the previous week, declined
> 8.5 percent (The Wall Street Journal, page A2).
>
> DUE FOR RELEASE TOMORROW:  Work Experience of the Population in 2000.
>

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