BLS DAILY REPORT, WEDNESDAY, FEBRUARY 26, 1997 RELEASED TODAY: In November 1996, there were 1,355 mass layoff actions by employers as measured by new filings for unemployment insurance benefits during the month. Each action involved at least 50 persons from a single establishment, and the number of workers involved totaled 122,341 persons. Although the number of layoff events was higher than in November 1995, the number of workers involved decreased slightly over the year .... __Prices of goods imported into the United States fell 0.3 percent in January, largely due to a drop in nonpetroleum prices, BLS reports. The January price drop followed a 0.1 percent December advance and market the second decline in three months. Import prices have gained only 0.8 percent in the year ended in January ....(Daily Labor Report, page D-1). __The Wall Street Journal (page A2) includes the import-export news with the report on consumer confidence, saying that the import-export news provides further evidence of the strengthening dollar's impact on the U.S. trade picture .... __Senate Major Leader Trend Lott's call for an independent panel of economic experts to recommend annual cost-of-living adjustments for federal benefit programs got a mixed reception from other political leaders yesterday ....Senate Minority Leader Thomas A. Daschle (S.D.) hailed the proposal. But its chances may have been hurt when both House Democratic Leader Richard A. Gephardt (Mo.) and House Republican Leader Richard K. Armey (Tex.) came out against it. Lott, meanwhile, sounded more cautious about the idea yesterday, acknowledging that he had not studied it thoroughly ....Administration officials, meanwhile, stuck scrupulously to the cautious, noncommittal language they have employed for the past several months .... (Washington Post, page C13). __Senate Minority Leader Daschle endorsed Senate Majority Leader Lott's call for an expert commission on the government's inflation index, giving a bipartisan cast to an idea that could ease the way to a balanced-budget pact. Meanwhile, their House counterparts split with the senators on the matter, reflecting the political sensitivity of the CPI, which is used to determine Social Security increases and income-tax brackets ....(Wall Street Journal, page A4). "The Right Way to Adjust for inflation" -- how to get the most out of changing the CPI -- by Martin Feldstein, former chairman of the President's Council of Economic Advisers and president of the National Bureau of Economic Research, appears on the editorial page of the Wall Street Journal. Feldstein says there are several reasons for the systematic difference between the CPI rise and actual increases in the cost of living. Some of these are technical problems that could be reduced by improving the methods that BLS uses to produce the CPI ....But such technical issues are much less important than the problems associated with new products and with changes in the quality of existing products ....There is no statistically rigorous way to modify the CPI for the quality changes in the millions of products in our economy or to take into account all of the new products that are introduced each year ....That's why the CPI should be regarded as only a starting point for calculating an official Inflation Adjustment Factor ....Feldstein goes on to think about the separate roles of the BLS and of an advisory committee to recommend such a factor .... __Consumer confidence remained strong in February, edging down 0.3 point, the Conference Board says ....Of those surveyed, 14.0 percent expect there will be more jobs half a year from now, down from 14.5 percent in January; 13.7 percent, about the same as in January, think there will be fewer jobs. Likewise, there was not a big change in expectations about income, with 24.5 percent, up from 24 percent, anticipating their income will rise, while 6.4 percent, up from 5.8 percent, think their incomes will decrease ....(Daily Labor Report, page A-1; Washington Post, page C11; New York Times, page B21; Wall Street Journal, page A2).. American workers may finally be getting their nerve up to demand a raise, and more employers are responding, says the Wall Street Journal (page A2). Aided by a low unemployment rate and increased demand for skilled labor, workers appear to be overcoming their fear of losing their jobs. The evidence -- both statistical and anecdotal -- even shows that more people are willing to quit to look for a better job because they feel there is plenty of work to be had ....Partly as a result, wage increases -- though still moderate -- are showing signs of quickening. According to BLS, average hourly pay rose at a 3.7 percent annual rate in January -- the biggest jump in nearly seven years -- after climbing at a 3.3 percent rate in the second half of 1996. Overall compensation, which includes benefits, also is climbing, although not quite as quickly. While the increased compensation is good news for workers, some economists fear that rising labor costs could also fuel inflation and force the Fed to boost interest rates. Fed Chairman Alan Greenspan has argued that worker insecurity is a powerful force in keeping compensation inflation in check ....A chart with the article shows the percent of the work force that quit in the last five weeks and is still jobless, attributed to BLS. More than 190,000 high-tech jobs in the United States remain unfilled, forcing some employers to go abroad to find skilled workers, a trade group says. The labor shortage in the information technology industry hampers job growth, jeopardizes U.S. global competitiveness, and may lead to more outsourcing to foreign competitors, according to the president of the Information Technology Association of America. Increased recruiting and training efforts are part of the solution, the president of ITAA contends, but he pointed to changes in education as the determining factor ....(Daily Labor Report, page A-6). The Occupational Safety and Health Administration revises plans for 1997 survey of workplace injuries and illnesses and says it will seek data from 80,000 employers -- the number of firms from which it sought data in 1996 before a court found it lacked regulatory authority ....(Daily Labor Report, page A-6).
