BUREAU OF LABOR STATISTICS, DAILY REPORT, THURSDAY, FEBRUARY 28, 2002: RELEASED TODAY: Employers initiated 2,146 mass layoff actions in January 2002, as measured by new filings for unemployment insurance benefits during the month, according to data from the Bureau of Labor Statistics. Each action involved at least 50 persons from a single establishment, and the number of workers involved totaled 263,821. The number of initial claimants for unemployment insurance was the highest for the month of January since the series began in April 1995. Today's BLS release on mass layoffs uses the North American Industry Classification System (NAICS) for the assignment and tabulation of layoff data by industry. Previously, the Standard Industrial Classification (SIC) system was used. Thus, all industry data in this release differ from data previously published.
The number of new U.S. jobless claims last week was smaller than expected at 378,000, the government said today, while the 4-week moving jobless claim average, a more reliable indicator of labor market trends, fell to its lowest level in more than 6 months. First-time claims for state unemployment benefits rose 17,000 in the February 23 week from a sharply downwardly revised 361,000 the prior week, the Labor Department said. The climb, however, was not as large as Wall Street expectations for a rise to 385,000 from the 383,000 originally reported for the February 16 week. The closely watched 4-week moving average, fell to 373,250 in the week ended February 23 from 376,250 in the previous week. This was its lowest level since 372,000 in the week of August 11, 2001 (Reuters, http://www.bayarea.com/mld/bayarea/business/2763930.htm). The U.S. economy, propelled by the biggest surge in consumer spending on big-ticket goods in 15 years, grew at an annual rate of 1.4 percent in the final quarter of 2001, the government reported today. The bigger-than-expected increase in the gross domestic product, the broadest measure of the economy's health, could mean that economists will date the end of the recession around the end of last year or the beginning of this year. The revised reading on fourth-quarter GDP as reported by the Commerce Department is much stronger than the 0.2 percent growth rate estimated by the government a month ago. Many economists were forecasting a revised 0.9 percent rate of advance in the GDP, which measures the total output of goods and services produced within the United States. The 1.4 percent growth rate marked the economy's strongest performance in a year and came after the economy shrank at a 1.3 percent rate in the third quarter. In another report, the Labor Department said new claims for unemployment benefits rose by 17,000 to 378,000 last week. But the more stable 4-week moving average of claims, which smoothes out week-to-week fluctuations, fell to a 6-month low of 373,250, a sign that the economy is improving. A factor contributing to the stronger fourth-quarter GDP was more brisk government spending, which rose at a rate of 10.1 percent compared with a 0.3 percent growth rate in the third quarter. And, the trade deficit in the fourth quarter was less of a drag on the economy than the government had previously thought. The deficit reduced fourth quarter GDP by 0.35 percentage point, rather than 0.85 percentage point as initially reported (Jeannine Aversa, Associated Press, http://www.chicagotribune.com/business/chi-020228econ.story?coll=chi%2Dbusin ess%2Dhed). "Wal-Mart stores has just passed Exxon Mobil to become the world's largest company by sales and will thus top the Fortune 500", begins Virginia Postrel, author of "The Future and Its Enemies" in The New York Times feature "Economic Scene", page C2. Postrel contends: "By making goods cheap and available, Wal-Mart has raised the standard of living of average Americans." She quotes from a study made by McKinsey Global Institute, the research arm of the McKinsey consulting firm, which says "Surprisingly, the primary source of the productivity gains of 1995 to 1999 was not increased demand resulting from the stock market bubble, as some economists have claimed. Nor was information technology the source, though companies accelerated the pace of their I.T. investments during those years. Rather , managerial and technological innovations in only 6 highly competitive industries -- wholesale trade, retail trade, securities, semiconductors, computer manufacturing and telecommunications -- were the important causes." Competition and better management, not simply the spread of computers and the Internet, made the difference. Nowhere is that clearer than in retailing, Postrel continues. From 1987 to 1995, labor productivity grew an average of 1 percent a year. From 1995 to 1999, it grew 2.3 percent a year. This big jump, combined with increased employment, meant that real output per capita grew nearly 4 percent a year -- an extraordinarily fast rate comparable with those of some Asian economies during their period of economic takeoff. A quarter of that increased productivity came from retailing. And about a sixth of the improvement in retail productivity came from general merchandise, most of it directly or indirectly from Wal-Mart. DUE OUT TOMORROW: Work at Home in 2001
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