FOR DELIVERY: 9:30 A.M., E.S.T. FRIDAY, NOVEMBER 5, 1999 Advance copies of this statement are made available to the press under lock-up conditions with the explicit understanding that the data are embargoed until 8:30 a.m. Eastern Standard Time. Statement of Katharine G. Abraham Commissioner Bureau of Labor Statistics Friday, November 5, 1999 Good morning. I am pleased to have this opportunity to comment on the employment and unemployment data released this morning. The unemployment rate, at 4.1 percent in October, changed little over the month, and has been 4.3 percent or less since March. Nonfarm payroll employment, as measured by the establishment survey, rose by 310,000 in October, following a much smaller gain of 41,000 (as revised) in September. Over the 2 months together, job growth averaged 176,000 per month. In October, employment in the services industry rose by 215,000, following a much smaller increase in September. Employment in business services rose by 75,000 (mostly in help supply services) and there were notable gains in amusements and recreation, private education, health services, social services, and engineering and management services. Computer services has shown relatively little growth for 2 straight months. Employment in wholesale trade rose by 20,000 in October, with the increase concentrated among durable goods distributors. In transportation and public utilities, 17,000 jobs were added in October. Substantial job gains occurred in both transportation and communications. Since June, employment in communications has increased by 28,000. Real estate added 10,000 jobs over the month, following 2 months of small employment declines. The October employment gain of 5,000 in finance was in line with monthly gains for the first 9 months of the year and was led by a 7,000 increase in security and commodity brokerages. The number of jobs in mortgage banks and brokerages declined by 5,000 over the month. Since May, job losses in this industry have totaled 19,000, likely reflecting the recent rise in mortgage interest rates. Retail employment fell in October, the third decline in a row following a large increase in July. Most of the over- the-month decrease was concentrated in eating and drinking places. Employment in auto dealerships continued to grow in October; over the past 12 months, job gains in that industry have totaled 42,000. Government employment rose by 53,000 over the month, after seasonal adjustment, with most of the gain in local government. In the goods-producing sector of the economy, the number of construction jobs rose by 28,000 in October, matching the September increase. Employment in mining rose by 4,000, with oil and gas extraction accounting for all of the increase. Oil and gas employment had been essentially flat from June to September, following significant losses over the prior 16 months. The number of factory jobs fell by 15,000 in October. Job losses in manufacturing have slowed recently; since June, the industry has lost 47,000 jobs, compared to 215,000 over the first half of the year. In October, job losses continued in durable goods manufacturing, especially in transportation equipment and industrial machinery. In nondurable goods, employment levels in textiles and apparel continued their long-term declines. Average weekly hours of production or nonsupervisory workers rose by 0.2 hour over the month to 34.6 hours. The factory workweek and factory overtime each edged down by 0.1 hour in October, to 41.7 and 4.6 hours, respectively. Average hourly earnings of private production or nonsupervisory workers edged up by 1 cent in October, following a rise of 7 cents in September. Over the year, average hourly earnings increased by 3.6 percent. Turning to data from the household survey, the unemployment rate was about unchanged in October at 4.1 percent. Jobless rates for all the major demographic groups showed little or no change in October. Civilian employment, at 133.9 million, rose over the month. In summary, payroll employment rose by 310,000 in October. The unemployment rate was little changed at 4.1 percent. Before concluding, I would like to provide you with a preliminary estimate of the effect on our total payroll employment figures of the benchmark revision scheduled for release next June. Once a year, the Bureau adjusts the payroll survey’s sample-based employment estimates to incorporate the previous year’s March universe employment counts in a process known as benchmarking. These universe employment counts are derived principally from state unemployment insurance tax reports that nearly all employers are required to file. By early November of each year, we typically have completed preliminary tabulations of these universe counts for the first quarter of the year. We routinely share our estimate of the anticipated size of the benchmark revision for the prior March at the time we release our October Employment Situation report. Preliminary tabulations for the first quarter of 1999 indicate that the payroll employment estimates will require only a slight adjustment, an upward revision of approximately 146,000, or one-tenth of one percent, for the March 1999 reference month. The historical average for benchmark revisions over the past decade has been plus or minus 0.3 percent. My colleagues and I now would be glad to respond to your questions. 3 5