BLS DAILY REPORT, WEDNESDAY, JANUARY 10, 2001
The number of mass layoffs surged to 1,697 events in November, doubling the
number of events in October and reaching its highest level in 10 months, the
Bureau of Labor Statistics says. Although BLS advises against
month-to-month comparisons because the data are not seasonally adjusted, the
number of layoff events was the highest for the month of November since the
series began in 1995, while the number for October was that month's lowest
since 1995. The mass layoff events, which affect 50 or more workers from a
single establishment regardless of the duration of the layoffs, resulted in
216,514 initial claims for unemployment insurance, BLS said. ... (Daily
Labor Report, page D-1).
First-year wage and benefit increases negotiated in construction industry
collective bargaining agreements during 2000 averaged $1.19 per hour, or 4.1
percent, according to data compiled by the Construction Labor Research
Council. Second-year increases in new multiyear agreements averaged $1.28,
or 4.0 percent. The 2000 increases were slightly above the $1.14 per hour
or 3.8 percent reported by CLRC for 1999. ... (Daily Labor Report, page
A-3).
A closely watched monthly poll of economists showed the sharpest 2-month
markdown in expectations for economic growth since the last recession. The
consensus of forecasters surveyed by the Blue Chip Economic Indicators
newsletter called for growth in the GDP of 2.6 percent this year. Polled
last week, the economists cut back their growth estimates by 0.5 percentage
point, following a reduction of 0.8 percentage point in their December
forecasts. The last time the consensus fell that quickly was between July
and September of 1990, the start of the last period of economic contraction
in this country. ... (Wall Street Journal, page A2).
Investment in information technology -- hardware, software, and
communications equipment -- would have to dry up or contract to push
productivity growth back down to pre-1995 levels, a Federal Reserve
economist says. In an updated presentation of a working paper released in
May 2000, Fed Senior Economist Daniel E. Sichel also told the Center for
Strategic and International Studies that he is "cautiously optimistic" that
most of the steep productivity gains logged in the late 1990s will be
permanent. ... (Daily Labor Report, page A-7).
For the first time in years, the dreaded word "recession" is back as a
buzzword. Oddly, though, it will be months, even years, before economists
know for sure if the U.S. has entered one, partly because the definition is
fluid. The most common definition of recession is two consecutive quarters
of economic contraction. ... Greg Mankiw, a Harvard University economist,
defines a recession more generally as "a period of declining real incomes
and rising unemployment." In some cases, he says, two quarters may be too
much. "If you had a big enough fall in one quarter, you'd probably call
that a recession, too," he says. For professional economists, the ultimate
arbiter of economic peaks and troughs is the National Bureau of Economic
Research's Business Cycle Dating Committee. "Basically, a recession is
whatever they want to call a recession," says Mankiw. ... The NBER
definition is "a recurring period of decline in total output, income,
employment, and trade, usually lasting from six months to a year, and marked
by widespread contractions in many sectors of the economy." In simpler
terms, they refer to it as the three Ds: depth, duration, and dispersion.
... (Wall Street Journal, page A2).
The last time the Federal Reserve was forced to cut interest rates in a
hurry -- in October 1998 -- it was to protect the United States from a
fast-spreading currency crisis in Russia, after more than a year of economic
turmoil in Asia. It was called the "contagion effect," and the strategy was
to stop it before it infected a booming American economy that had become the
predominant force for growth around the world. Little more than 2 years
later, there is now fear of a different kind of contagion effect, this one
radiating from the United States. ... For nearly 7 years, the United States
has so dominated the world economy that other nations have come to depend,
more than ever, on constantly rising demand from the United States for
products of all kinds. ... An accompanying table shows the percent of all
exports from eight countries that come to the United States. Mexico sends
84.3 percent of all that it exports to the U.S.; China sends 28.5 percent;
South Korea, 22.1 percent; Brazil, 21.2 percent; Thailand, 20.6 percent;
Hong Kong 18.4 percent; Chile, 17.2 percent; and Indonesia, 15.0 percent.
... (New York Times, Jan. 7, page A1).
Seven years after its enactment, the Family and Medical Leave Act has proved
to be a growing administrative burden for employers, but, at the same time,
it has had "no noticeable effect" in terms of productivity, profit, or
growth, according to a Department of Labor report, Balancing the Needs of
Families and Employers. ... The survey reports that 16.5 percent of
employees had taken family or medical leave in the 18 months prior to
responding, about the same percentage as the earlier survey. Leave-taking
increased among older employees, married employees, and employees with
children. The survey of some 2,500 individuals and 1,800 employers was
conducted by Westat, a Rockville, Md., consulting firm, under contract with
the Labor Department (ASP). ... (Daily Labor Report, page A-2).
DUE OUT TOMORROW: U.S. Import and Export Price Indexes -- December 2000
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