FOR DELIVERY: 9:30 A.M., E.D.T. FRIDAY, APRIL 7, 2000 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 Daylight Time. Statement of Katharine G. Abraham Commissioner Bureau of Labor Statistics Friday, April 7, 2000 Good morning. I am pleased to have this opportunity to comment on the labor market data that we released this morning. The unemployment rate was unchanged in March at 4.1 percent. Nonfarm payroll employment, as measured by our establishment survey, expanded by 416,000 over the month, but there are several special factors that must be taken into consideration when interpreting this large increase: - March job growth included an estimated 117,000 temporary workers hired by the Federal government to help conduct the census. - It also is likely that part of the large March gain in nonfarm employment resulted from a calendar anomaly. This year, there were 5 weeks between the February and March survey reference periods instead of the usual 4 weeks. The last time this happened was 28 years ago, in 1972, and the next time it will happen is 2028. (A 5-week interval occurs only in leap years when the March reference week is the latest possible--the 12th of the month through the 18th.) As a result of this calendar effect, we likely picked up extra job growth in March that more typically would be counted in April. Although we seasonally adjust these data and have had procedures in place since 1996 to account for whether there are 4 or 5 weeks between surveys, the rarity of a 5-week period between the February and March surveys precludes such an adjustment for March. We would expect the effect of an extra week on this month’s employment growth to be in the range of 50,000 to 100,000, but it is impossible to quantify the effect precisely. - Part of the March increase reflects the return to work of some 15,000 workers in aircraft manufacturing who had been on strike (and therefore off payrolls) in February. Taking all of this into account, the increase in nonfarm payroll employment in March is probably roughly in line with the average monthly gain for 1999. Moving on to some of the industry employment developments in March, mining employment rose by 4,000 over the month, as oil and gas extraction continued its recent upward trend. In construction, employment rose by 89,000 in March, although this large gain almost certainly was bolstered by the extra week of hiring between the February and March surveys. It has been difficult to determine the underlying trend in construction employment in recent months. An exceptionally large gain in January associated with unusually mild winter weather was followed by a small decline in February; the large March gain likely reflects some of the seasonal hiring that normally is picked up in April. Manufacturing employment edged down by 5,000 in March; this follows several months of modest improvement in factory employment. The March decline would have been greater had it not been for the return of 15,000 workers in the aircraft industry who had been on strike in February. Industrial machinery lost 6,000 jobs in March, and there were smaller declines in several other manufacturing industries. In contrast, fabricated metals continued its recent pattern of job growth with a gain of 3,000. The factory workweek and overtime hours each fell by 0.2 hour in March, to 41.6 and 4.6 hours, respectively. In the service-producing sector of the economy, the services industry added 150,000 jobs in March, following little growth in February. Average monthly growth in services for the first quarter of this year (106,000) was slightly behind the average monthly gain for all of 1999 (121,000). Job growth in services was widespread in March. Employment in business services rose by 48,000, and educational services added 21,000 jobs. Sizable gains in agricultural services (18,000) and hotels (15,000), two industries that typically experience seasonal hiring in March and April, must be viewed in the context of the extended interval between the February and March surveys. The transportation industry added 24,000 jobs in March, mostly in trucking and air transportation. There was a gain of 17,000 in wholesale trade employment. In contrast, employment at the retail trade level was about unchanged in March for the second month in a row. March employment declines in general merchandise stores and eating and drinking places were offset by increases in building materials, auto dealers and service stations, and furniture stores. Employment in the finance industry declined slightly in March. Mortgage banking, which has been adversely affected by the recent rise in home mortgage rates, lost 12,000 jobs over the month, bringing the total losses in the industry to 35,000 since last May. In contrast, job growth continued in March in security brokerages. Federal government employment surged by 106,000 in March, as the long-term downward drift in Federal employment was swamped by an estimated 117,000 temporary workers hired to help conduct the decennial census. Local government employment rose by 34,000 over the month. Average weekly hours of production or nonsupervisory workers on private nonfarm payrolls held steady at 34.5 hours in March. Average hourly earnings of private production or nonsupervisory workers rose by 5 cents over the month to $13.60. Over the year, hourly earnings rose by 3.7 percent. Turning now to the data from our survey of households, the unemployment rate was unchanged in March at 4.1 percent, and has been below 4.2 percent since last October. The rates for all of the major demographic groups (adult men, adult women, teenagers, whites, blacks, and Hispanics) showed little or no change in March and have been fairly stable in recent months. Civilian employment was essentially unchanged in March and the proportion of the working age population that was employed, 64.7 percent, also was little changed. The number of persons who held more than one job totaled 7.7 million in March (not seasonally adjusted). These multiple jobholders made up 5.7 percent of the total employed, down from 6.1 percent a year earlier. In summary, the unemployment rate was unchanged in March at 4.1 percent. Payroll employment rose markedly, although job growth was elevated both by the hiring of census workers and by the effects of a calendar quirk. My colleagues and I now would be glad to answer your questions.