> BLS DAILY REPORT, THURSDAY, FEBRUARY 26, 1998
>
> Wage data compiled by the Bureau of National Affairs in the first
> eight weeks of 1998 show that the median first year wage increase in
> newly negotiated labor contracts is 3 percent, the same increase as
> reported for the year-ago period. The weighted average increase for
> settlements reported to date is 2.7 percent, compared with 4.6 percent
> in 1997. Major settlements reported in the current biweekly period
> include those of Honeywell Inc. with the International Brotherhood of
> Teamsters and Johnstown America Corp. with the United Steelworkers
> ….(Daily Labor Report, page D-1).
>
> Private forecasters expect the U.S. economy will grow 2.6 percent this
> year, moderating from 1997's robust 3.8 percent pace, and slow further
> to 2.2 percent in 1999, the National Association of Business
> Economists says. The "chief culprit" is the Asian financial crisis,
> which NABE members think will reduce growth by one-half to a full
> percentage point this year, the NABE president noted ….At the same
> time, despite their increased pessimism about the trade deficit, the
> NABE panelists are more optimistic overall ….That is because the U.S.
> economy has outperformed expectations and also has benefited from
> lower interest rates due in part to the Asian crisis, which has pulled
> money into U.S. Treasury securities and contributed to the view that
> inflation will remain low ….Inflation, as measured by the CPI, should
> be stable, holding at 2 percent this year, then rising to 2.5 percent
> in 1999. The unemployment rate is forecast at 4.8 percent, rising to
> 5.0 percent next year. And most of the panelists said they do not
> expect a recession before the year 2000, at the earliest ….(Daily
> Labor Report, page A-8).
>
> Though most of the nation's biggest companies have felt only a slight
> bump from the Asian crisis, some powerful chief executives are worried
> that the damage will get a lot worse. A survey conducted in recent
> weeks of 101 members of the Business Council, a Washington-based
> organization of blue-chip company leaders, shows 74 percent saying
> they currently expect Asia's financial crisis to have only a "small
> negative effect" on "growth and earnings prospects for 1998" ….(Wall
> Street Journal, page A2).
>
> The nearly 5 million retired federal and military personnel and
> survivors may get slightly smaller cost-of-living adjustments in the
> future, thanks to a just-updated consumer price index, said Mike
> Causey in his The Federal Diary column (Washington Post, Feb. 25, page
> B2). Federal and military personnel work for the nation's only major
> employer whose pension payments keep pace with inflation ….After a
> long study … the BLS revamped the "market basket" ….Critics … have
> long contended that the CPI overstated inflation ….But the BLS, which
> has a long-standing reputation for its just-the-fact-approach, has
> been reluctant to tamper with the CPI, especially when changes were
> demanded by groups with a political or fiscal agenda … said Causey ….
>
> DUE OUT TOMORROW: State and Regional Unemployment, 1997 Annual
> Averages
>
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