BLS DAILY REPORT, WEDNESDAY, SEPTEMBER 6, 2000
RELEASED TODAY: BLS today reported revised productivity data--as measured
by output per hour of all persons--for the second quarter of 2000. The
seasonally adjusted annual rates of productivity change in the second
quarter were 6.5 percent in the business sector, 5.7 percent in the nonfarm
business sector, and 5.4 percent in manufacturing. ...
In December, the Commerce Department's Bureau of Economic Analysis will
release a CD-ROM outlining gross product by industry that will include
current-dollar estimates of employee compensation as a component of gross
state product. The other two gross state product components are indirect
business tax and nontax liability and property-type income. The database
also includes inflation-adjusted estimates for 63 industries covered in the
report. The CD-ROM includes a data-retrieval program that allows users to
view or print selected records from the database and selected analytical
table and charts. ... (Daily Labor Report, page A-11).
As the summer ends, the corporate earnings outlook is being undermined by
signs that the economy is slowing. And some stock market analysts are
warning that, while profit growth will remain strong, the current
projections for the last quarter of this year and the first of next year are
too optimistic. The employment data released on Friday reinforced the
belief that the economy was cooling after six rate increases by the Federal
Reserve. In August, nonfarm payroll jobs, excluding census workers and
strikers, rose just 140,000, well below the 222,000 average for the first
seven months of the year. Manufacturing jobs actually declined, and
manufacturing activity shrank after 18 months of growth, according to a
purchasing managers' index. The big automakers are cutting production.
Home appliance manufacturers, like Whirlpool, say slowing demand will cut
into their profits the rest of the year. Department stores, already
beleaguered, are warning of a weak end to the year. Furthermore, surges in
the prices of crude oil and home heating oil for this winter will cut into
consumers' ability to spend. ... While these factors suggest slower
economic growth, the good news is that a slowdown does not have to be as
sharp as in the past to be successful in curbing inflation. Put another
way, the soft landing that the Federal Reserve desires can come at a higher
growth rate than in the past. This means that the economy could be growing
at a pretty brisk pace of 3.5 percent or 4 percent when the soft landing
arrives and that the Fed could be finished with interest rate increases. ...
(New York Times, page C1).
U.S. crude oil prices briefly surged above $34 a barrel Tuesday, nearly
matching a decade high, as analysts fretted about thinning oil supplies and
possible shortages of heating oil this winter. Some traders predicted the
price of oil could run up to $40 a barrel in coming months unless OPEC
boosts production. That kind of spike could mean higher gasoline prices and
bigger bills for consumers who use heating oil and natural gas. What's
more, the decline in gasoline prices that usually accompanies the end of the
summer driving season might not happen this year, analysts say. ... (USA
Today, page 1B).
Homeowners are a bit richer than they were just a few months ago, at least
on paper. The value of houses across the country continued to appreciate in
the second quarter of this year, rising at an annual rate of 6.9 percent,
according to a study released by mortgage industry giant Freddie Mac. The
study showed that the prices of houses nationwide increased at the same 6.9
percent rate in the 12 months ended June 30. ... (Washington Post, page
E3).
Health insurance premiums are increasing 10 to 30 percent nationwide,
according to employers, insurers, and regional business groups familiar with
rates being paid by dozens of companies. Driven largely by escalating drug
costs, the double-digit increase is the third in a row for many companies.
The rising premiums suggest that, apart from the most restrictive,
bare-bones health maintenance organizations, managed care is no longer
keeping medical costs down. The increasing costs come at a time of rising
concern about health care costs, particularly drug costs, in Medicare. ...
(New York Times, page A1).
Small employers that do not offer health insurance coverage to their workers
identify affordability problems for both themselves and their employees as a
key barrier to providing the benefits, according to a survey released by the
Employee Benefit Research Institute. The survey also found that problems of
affordability may be compounded by misperceptions about the business value
of offering health benefits. Tax deductions for both employers and workers
and recent regulatory changes by state and federal governments have
restructured the small employer health insurance market. ... (Daily Labor
Report, page A-1).
Will it be a boon to unions or a Pyrrhic victory that the National Labor
Relations Board has decided to allow workers supplied by a temporary agency
to be represented by a union in the same bargaining unit with regular
employees? Will the ruling discourage employers from hiring workers
supplied by a temporary agency or encourage their use as a strategy for
avoiding unionization? Will temporary workers welcome the theoretically
better opportunity to collectively bargain or show little interest? In the
wake of the board's recent 3-1 ruling in M. B. Sturgis Inc., these questions
are among many that have been raised and are being pondered by union,
management, and association representatives regarding the ruling's impact.
... (Daily Labor Report, page AA-1).
DUE OUT TOMORROW: International Comparisons of Hourly Compensation Costs
for Production Workers in Manufacturing, 1999
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