> BLS DAILY REPORT, MONDAY, APRIL 9, 2001:
>
> A surprisingly weak employment report -- showing a loss of 86,000 jobs in
> the nonfarm sector -- set off alarms on the economy's health, but few
> analysts say the March figures are a sure sign of a recession. Rather,
> most economists agree the report describes an economy that is more
> vulnerable than it was a few months ago. Payrolls were slashed most
> severely in manufacturing last month, with factory cuts contributing
> 81,000 of the total decline, according to the Bureau of Labor Statistics.
> Temporary help firms and retailers also were hit hard last month, while
> most services industries continued to show job growth. The nation's
> unemployment rate edged up 0.1 percentage point to 4.3 percent, the
> highest level since July 1999 (Daily Labor Report, page D-1; Statement on
> March Employment Report by BLS Commissioner Abraham at the April 6
> briefing, page E-14).
>
> The nation's employers shed 86,000 jobs in March, the largest loss for a
> single month in more than 9 years and an indication to many economists
> that the United States may be on the verge of a recession, says Louis
> Uchitelle in The New York Times (April 7, page A1).
> The unemployment rate took another tick upward, to 4.3 percent from 4.2
> percent in February and 3.9 percent in October, as the Labor Department's
> job figures, announced yesterday, finally reflected the parade of layoffs
> and hiring freezes since last fall. Job losses in March, as they have
> been for months, were concentrated in manufacturing. But this time job
> gains elsewhere were no longer sufficient to offset the cutbacks.
>
> Prospects for a quick economic rebound this summer are fading. And that
> calls into question more than just growth for the year. The longer this
> slowdown lasts, the greater the threats to two defining traits of the
> remarkable 1990s boom: The rise in productivity that promised higher
> living standards for years to come, and the spread of those benefits to
> minorities and lower-skilled workers left behind during previous
> expansions. Friday's employment report was the latest reason for
> pessimism. The jobless rate moved up another notch to 4.3 percent in
> March, the highest level in a year and a half. Payrolls outside farms
> fell by 86,000, the biggest one-month loss of jobs since the economy was
> struggling to pull out of the last recession nearly a decade ago. More
> worrisome, the report suggested that the economy's weakness, which had
> largely been contained to manufacturing, has begun to spread to services
> (The Wall Street Journal, page A1).
>
> The slumping economy has many employers cutting back on the job offers and
> internships they're offering college graduates. "It's a return to an
> environment where employers are acting rationally and students have to
> sell themselves again," says the director of the career planning and
> placement center at California State University, Fullerton (USA Today,
> page 1B).
>
> "Are we in trouble or aren't we?" asks Penelope Patsuris, Forbes.com,
> April 6. This morning, the U.S. Bureau of Labor Statistics reported a
> March unemployment rate of 4.3 percent, slightly up from March 2000's 4.0
> percent, but still extremely low by historical standards, she says. "In
> 1998, the unemployment rate was 4.5 percent," says Brookings Institute
> economist Gary Burtless, "and at that time no one in their right mind
> thought the job market was anything but tight." Nevertheless, corporate
> America's employees are being shown the door with an alarming frequency.
> Yesterday, outplacement firm Challenger, Gray & Christmas sounded the
> alarm by reporting that March's 167,867 job cuts were triple what they
> were for that month last year. Even the more conservative and perhaps
> less headline-hungry Bureau of Labor Statistics recorded a 44 percent jump
> in layoffs from last February to this February (March figures have yet to
> be released). To some extent, recent layoffs have become larger than life
> because they're hitting major, publicly held companies. And while public
> companies are obliged to pre-announce layoffs, these cuts are often
> staggered over long periods of time and are achieved to a certain extent
> through voluntary attrition like early retirements. Even at U.S.-based
> companies, job cuts are coming from overseas offices. "How
> DaimlerChrysler will achieve a reduction in its payrolls is being
> misrepresented," says BLS economist Lewis Siegal. "The average person
> sees the headlines and thinks that 26,000 people will be on the street the
> very next day. In reality, they're not."
>
> The Wall Street Journal's feature "Tracking the Economy" (page A25) shows
> import prices for March, to be released by BLS Wednesday, at minus 0.1
> percent, according to the Thomson Global Forecast. The previous actual
> percentage was 0.1. The Producer Price Index data for March, to be
> released Thursday, is predicted to be a 0.1 percent increase by Thomson
> Global Forecast, the same change as the actual February percentage.
>
> Temporary help supply employment has fallen by 223,000 in the last 4
> months, but a turnaround in that trend may be a good indicator that
> business conditions are improving, according to data from the Bureau of
> Labor Statistics. Following each of the last two recession in the United
> States, temporary employment grew at least 400 percent faster than the
> overall level of employment for the country, BLS data show. As the United
> States was emerging from the recession of 1981-1982, overall employment
> growth for the nation averaged about 3.5 percent per year between December
> 1983 and December 1985, while help supply employment grew an average of
> 15.6 percent during those years. Following the 1990-1991 recession,
> overall employment grew at an average rate of 1.8 percent per year from
> December 1992 and December 1994, compared with 18.0 percent growth in help
> supply employment during that period, BLS data show. According to BLS data
> released April 6, the number of temporary help supply workers on the
> payrolls of U.S. businesses fell by 83,000 in March, the single-largest
> monthly decline since BLS began tracking the figure in 1982 (Daily Labor
> Report, page A-11).
>
> The all-settlements weighted average first-year wage gain in agreements
> reported in the first quarter of 2001 was 6.3 percent, compared with 3.5
> percent in first-quarter 2000. The second-and third-year weighted average
> increases in agreements reported in the first quarter of 2001 were 3.7
> percent and 3.3 percent respectively, compared with second-and third-year
> increases of 3.2 percent and 2.7 percent, respectively, reported in the
> first quarter of 2000, according to data compiled by the Bureau of
> National Affairs (Daily Labor Report, page D-19).
>
> The combination of this year's cold winter and high natural-gas prices
> have raised the prospects for a second straight summer of surging gasoline
> prices. The Department of Energy is warning that gasoline inventories are
> so low that a major refinery problem or pipeline outage could send pump
> prices shooting up again. Gasoline inventories are running 5 percent
> below last year's already low levels and 9 percent below normal levels,
> according to the DOE's Energy Information Administration (The Wall Street
> Journal, page A2).
>
> For decades Los Angeles was known as an antiunion town, but now it seems
> to have warmed up to unions, largely because of the huge influx of
> Hispanic immigrants.. More than 1.3 million Hispanics have moved to the
> city since 1990, many of them using unions as a ladder out of poverty. By
> focusing its organizing on immigrant workers, the city's labor movement is
> adding workers faster than unions anywhere else in the country. In recent
> years, unions have organized 6,000 part-time school aides, 2,000 food
> service workers and retail workers at the international airport and 2,000
> Los Angeles park and recreation workers. At the same time, many affluent
> Angelinos are viewing unions more charitably, concluding that they help
> lift the lowest paid workers. The union movement in Los Angeles is now
> looked to as a model for the languishing labor movement in other cities
> because of its recent successes and the enthusiasm the movement has
> stirred among immigrant workers. Two months ago the national AFL-CIO
> arranged for Los Angeles labor leaders to hold what was essentially a
> tutorial for New York labor leaders (Steven Greenhouse in The New York
> Times, page A14).
>
> DUE OUT TOMORROW: Multifactor Productivity Trends, 1999
>
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