BLS Daily Report

[Richardson_D <Richardson_D@xxxxxxx>]

BUREAU OF LABOR STATISTICS, DAILY LABOR REPORT, WEDNESDAY, DECEMBER 26,
2001:

RELEASED TODAY:  Regional and state unemployment rates were generally higher
in November than in the prior month.  Jobless rates rose in all four regions
and in 36 states, while only 6 states posted decreases, the Bureau of Labor
Statistics reports.  The national jobless rate increased to 5.7 percent in
November.  Nonfarm employment decreased in 34 states.

Unemployment rates increased in 36 states in November and only six states
showed declines, according to figures released by the Bureau of Labor
Statistics.  Oregon and Washington reported the highest unemployment rates
in November, 7.4 percent and 7.0 percent.  It was the first time since
January 2000 that any state had a jobless rate above 7.0 percent (Daily
Labor Report, page D-17).

Consumer spending fell 0.7 percent in November, as personal income decreased
to 0.1 percent, according to figures of the Bureau of Economic Analysis,
Department of Commerce.  According to revised September and October data,
which earlier showed no change personal income steadily declined at 0.1
percent in each of the last 3 months, while disposable personal income --
personal income minus personal tax and nontax payments -- slowed to a
decrease of less than 0.1 percent in November, compared with a 1.8 decrease
in October and a 1.2 decrease in September (Daily Labor Report, page D-1;
Bloomberg News, The New York Times, December 22, page C4).

Median household income dropped between 1989 and 1998 in Queens, Brooklyn,
Suffolk, Fairfield, and many other countries across the nation that
experienced a large influx of immigrants, according to new census data.  The
data indicate that even as the economy in the New York region and the nation
rebounded after the recession of the early 90's, figures for median
household income adjusted for inflation, failed to climb in many counties
because of the increase in low-income immigrant workers.  The new data show
that in Brooklyn, Queens and the Bronx -- counties with a major increase of
immigrants -- median income fell sharply.  More surprising, though, was the
marked income drop in some of the region's wealthiest suburbs, including
Nassau, Suffolk and Westchester Counties in New York, and Fairfield County
in Connecticut.  "Immigrants are jumping immediately into these inner-ring
suburbs, which is a change from the past 300 years, when the first
generation lived in inner-city neighborhoods," says Robert D. Yaro,
executive director of the Regional Plan Association, which works to improve
the economy of the New York region. "This new phenomenon in reducing
household incomes in some of the well-to-do-suburbs as immigrants move into
them is consistent with the national phenomenon of the suburbanization of
poverty,"  The new data show that median income also fell in many counties
in other states attractive to immigrants, including Los Angeles County and
Miami-Dade County (The New York Times, December 22, page A13).

The University of Michigan's index of consumer sentiment rose sharply in
December for the third straight month.  The index finished the year at 88.8,
up strongly from the 81.1 reported in September.  A companion index of
consumer expectations rose by a similar amount (Steven Pearlstein, The
Washington Post, December 22, page E1; The Wall Street Journal, December 24,
page A2).

The U.S. economy contracted at 1.3 percent annual rate in the July-September
quarter, the Commerce Department says, reporting the Gross Domestic Product
(Daily Labor Report, page D-7).

Gasoline prices fell an average of 3 cents a gallon nationwide during the
past 2 weeks, reaching the lowest level in nearly 3 years.  Analysts warned,
however, that motorists should not expect the trend to last much longer
(Associated Press, The Washington Post, December 24, page A5).

The home ownership rate increased in all but a handful of states in 2000
compared with 1995, thanks to low interest rates, aggressive
mortgage-lending practices, and a then still vibrant economy..  And while
more recent figures aren't available on a state basis, national data show
that home ownership continued to rise for the country as a whole, reaching a
record 67.9 percent in the third quarter of 2001.  Among the states in 2000,
Great Plains, East South Central and Great Lakes states had the highest
ownership rates due to lower home prices and fewer opportunities to rent.
Michigan topped all states with 77.2 percent ownership for an additional
reason:  its many higher wage factory workers (Graph in The Wall Street
Journal, page B10).

Companies are turning to low-cost perks for workers as a means of building
loyalty encouraging teamwork and making employees' lives easier without
incurring great cost, according to a survey by Challenger, Gray & Christmas.
These on-site-benefits, dubbed "recession perks" include banking machines,
employee-paid fitness centers, dry cleaning pickup, barbecue grills,
financial service referrals and company-sponsored career counseling,
Challenger reports.  They take the place of pricey luxuries such as
providing employees with cars or giving them significant bonuses (Daily
Labor Report, page A-5).

So far this recession has not been as tough on workers as the previous one
was, says Business Week (December 24, page 26).  The last recession ran 8
months, from July 1990 to March 1991, and nonfarm payrolls dropped 1.3
percent.  By contrast, in the 8 months from March 2001, the beginning of the
current downturn, to November, employment has declined only 0.9 percent. Yet
workers in the technology sector have taken a much harder pounding this
time.  Employment in the key tech industries -- software and computer
semiconductor and communications equipment manufacturing -- peaked in March
and since then has fallen by 3.3 percent.  In contrast, by the time the
1990-91 recession ended, employment in the tech sector had fallen only 1.7
percent from its 1989 peak.

The 1990s marked a dramatic rise in the flexibility of the U.S. labor
markets.  In particular, the sharply increase use of contingent workers and
variable pay allowed companies to more closely align their labor costs with
output.  Now, with demand and output falling, the downside of that
flexibility is a key factor shaping the outlook for the labor markets,
consumers, and the economy.  Temporary workers are taking a beating in this
recession, accounting for a disproportionately large share of the losses in
jobs and incomes.  And a greater number of job seekers can only find
part-time employment.  But on the plus side, the hit may not be as great as
in past downturns, so morale may not suffer as much as in the past.  And so
far, workers' pay continues to grow at a healthy pace.  That is one factor
giving consumer spending its resilience (Business Week, December 24, page
27).

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