[PEN-L:19] BLS Daily Report

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BLS DAILY REPORT, MONDAY, JUNE  15, 1998

RELEASED TODAY:  Time off for recreation and other purposes was the most
frequently available employee benefit for full-time employees in small
private industry establishments in 1996.  Medical benefits, retirement
plans, and life insurance were often available, but less prevalent.
Other benefits, such as employee assistance and wellness programs,
common in other sectors of the economy, were comparatively rare in small
establishments.  Generally, the incidence of employee benefit plans in
small establishments had not changed noticeably since the 1994
survey....  

__A large increase in the cost of prescription drugs and a jump in
tobacco prices helped drive up the producer price index for finished
goods a seasonally adjusted 0.2 percent in May.  Most economists believe
inflation at the producer level remains quiet and that the last two
months do not indicate a trend.  The core rate - excluding often
volatile prices for food and energy - increased 0.2 percent in May,
after an identical April advance. In May, a 4.3 percent increase in
gasoline prices pushed up energy prices 0.8 percent.  This follows seven
consecutive months in which energy prices fell.  A senior economist with
the WEFA Group said he expects falling oil prices to hold down producer
prices in the near future....  (Daily Labor Report, page D-1).
__Apparently the perfect economy is causing high anxiety in some
quarters, says Tim Smart of the Washington Post (June 13, page D1).  A
manic surge in the price of drugs used to combat obsessive-compulsive
behavior and depression caused the government's main gauge of producer
prices to rise 0.2 percent in May, the Labor Department reported. The
increase in the producer price index was greater than economists
expected, but markets shrugged off the spurt as an anomaly because it
was so influenced by one group of products.  Without the increase in
drug prices, the PPI would have been unchanged in April....  
__Prices paid to producers rose during May for the second consecutive
month, but the increase reflected record growth in the cost of
prescription drugs and analysts continued to forecast a low inflation
rate for the year....  (New York Times, June 13, page B14).
__After a 585 percent rise in a prescription drug category known as
"minor tranquilizers," the Labor Department's report on prices paid to
factories and other goods producers rose 0.2 percent.  It was the second
monthly increase after five consecutive months of declining prices....
(Wall Street Journal, page A2). 

Since the 1970s, the gap in wages between skilled and unskilled workers
has widened sharply.  But new research shows the inequality does not
stop there, says an article by Peter Passell in the New York Times (June
13, page A1).  Discrepancies in job benefits and the quality of work
life have also grown, pointing to a bigger chasm than previously
recognized....  Brooks Pierce, an economist at the United States
Department of Labor [BLS], used confidential data regularly collected by
BLS from businesses to measure trends in total compensation.  The
results are striking:  While specialists had long assumed that benefits
acted as a leveling influence, particularly because of
government-required benefits like Social Security and unemployment
insurance, the opposite is true....  Benefits led to a greater
discrepancy in earnings between high- and low-wage workers in both 1982
and 1996.  Moreover, they were responsible for one-tenth of the
increasing disparity between the working elite and the working poor over
the 14 years....  The catch, according to Mr. Pierce, is that a growing
number of workers at the bottom of the pay scale have lost access to key
employer-provided benefits....  

"What People Earn" is the feature of "Parade Magazine" (June 14,
Washington Post Sunday supplement).  The good economic news continues,
says Parade, with most Americans getting pay raises that beat inflation
for the first time in six years....  Shown are 1997 hourly wages for all
Americans, $12.57; librarians, $15.95; policemen, $17.42; aerospace
engineers, $27.87; doctors, $28; special prosecutor Ken Starr, $56.92.
Source is BLS 1997 median weekly earnings (except for Starr), assuming a
40-hour week.

Business inventories rose 0.2 percent in April, while sales fell 0.1
percent, the Commerce Department reports....  (Daily Labor Report, page
A-2).

Workforce increases are planned this summer by 32 percent of companies,
the best quarterly outlook since the third quarter of 1978, when 34
percent were hiring, according to a page 1B graph in USA Today.
Companies planning increases by industry include:  construction, 40
percent; wholesale/retail, 36 percent; durable goods manufacturing, 33
percent; services, 31 percent; non-durable manufacturing and
finance/insurance/real estate, 28 percent; education, 27 percent;
transportation/utilities, 26 percent; and public administration, 25
percent.  Source of the data is Employment Outlook Survey, Manpower.

DUE OUT TOMORROW:
  Consumer Price Index -- May 1998
  Real Earnings: May 1998


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