> BLS DAILY REPORT, FRIDAY, MAY 7, 1999
>
> RELEASED TODAY: Employment rose in April, and the unemployment rate was
> essentially unchanged at 4.3 percent. Nonfarm payroll employment grew by
> 234,000. Job gains occurred throughout the service-producing sector, but
> losses continued in manufacturing and mining. ...
>
> Top executives of the largest U.S. industrial companies say the U.S.
> economy is experiencing "the best of times" as businesses continue to
> improve their operations while offering an increasing number of employees
> a chance to share in profits, Labor market tightness affects all of their
> industries -- from finance to shipping -- but it has not restrained sales
> or threatened to add to inflation, the executives say. ... To a large
> extent, the chief executive officers' view of labor market conditions
> explains their optimism on noninflationary growth. Productivity gains
> have offset any compensation increases because of worker shortages,
> especially in jobs demanding high skills, the business leaders say.
> Members of the Business Council, meeting in Williamsburg, Va., believe
> that the worst is over in the major Asian economies, a development they
> believe will result in sustained growth with little inflation. ... (Daily
> Report, page AA-1)_____The executives believe the global economic crisis
> is over and about half of them think business in the United States will be
> better this year than in 1998. ... Few company chiefs reported problems
> with tight labor markets, but a large majority said they still had little
> ability to raise prices, a trend they expect to continue for the next 6
> months (Washington Post, page E3; Wall Street Journal, page A10).
>
> __Federal Reserve Chairman Greenspan tells bankers that the recent growth
> in labor productivity, fueled by innovations in information technology, is
> largely responsible for the current subdued rate of inflation and 7 years
> of strong economic performance. ... (Daily Labor Report, page AA-1).
> __Greenspan says that an unexpected leap in technology is primarily
> responsible for the nation's "phenomenal" economic performance and the
> current extraordinary combination of strong growth, low unemployment, low
> inflation, high corporate growth, and soaring stock prices. Previously, he
> had emphasized some temporary factors, such as falling oil prices and a
> strong dollar, that had benefited the economy. But he had only speculated
> about whether more long-term forces were at work. But, in a speech in
> Chicago, he declared that the economy's performance "is not just a
> cyclical phenomenon or a statistical aberration" and instead "reflects --
> at least in part -- a more deep-seated, still developing shift in our
> economic landscape." His sweeping assessment indicated that he believes
> the U.S. economy can continue to grow, within some limits, more rapidly
> than in the past without causing inflation to increase. ... (Washington
> Post, page A1).
> __Despite a remarkable run of prosperity that he credited in large part to
> new technology, Greenspan delivered his bluntest warning in months __ the
> economy could still be derailed by its old nemesis, inflation. ... At the
> top of his list was declining unemployment, which he said would eventually
> push wages and perhaps prices higher in an inflationary spiral. ... (New
> York Times, page C1).
> __"At some point," Greenspan said, "labor market conditions can become so
> tight that the rise in nominal wages will start increasingly outpacing the
> gains in labor productivity and prices inevitably will begin to
> accelerate." He warned that inflationary pressures could re-emerge
> possibly faster than some currently perceive. ... (Wall Street Journal,
> page A2).
>
> New unemployment insurance benefits claims filed with state agencies rose
> by 6,000 to a seasonally adjusted 301,0000 in the week ended May 1, the
> Employment and Training Administration of the Department of Labor has
> announced. ... (Daily Labor Report, page D-1)_____Initial United States
> jobless claims rose by a larger-than-expected 6,000 in the latest week,
> the government said in a report that nevertheless suggested that
> employment prospects for workers remained strong. ... (New York Times,
> page C8).
>
> Businesses announced in April that they would cut 54,399 jobs, the lowest
> level in 6 months, according to a report by Challenger, Gray & Christmas.
> The number of job cuts declined 21 percent compared with March's total of
> 68,984. This made April the lowest job-cut month since November. ...
> (Daily Labor Report, page A2).
>
> Retailers' same-store sales rose 4.2 percent in April, beating forecasts
> for the seventh month in a row, as shoppers snapped up spring fashions at
> clothing chains and department stores. ... (Washington Post, page
> E3)_____For growth in consumption to accelerate after 8 years of economic
> expansion is a surprise -- the torrid pace had been expected to slow.
> Retail analysts and economists now point to several factors, including the
> continued rise of both the stock market and home values, to explain much
> of the gains. But another change is also helping. While the wealthiest
> consumers powered the expansion in its early stages, spending by those
> households in the bottom 40 percent, which is defined as people making up
> to $28,500 a year, has been picking up. Real growth in wages and the
> lowest unemployment rate in 30 years have spread the shopping spree into
> every corner of American society. ... (New York Times, page
> A1)_____Retailers' sales at stores open at least a year rose 3 percent in
> April, as shoppers snapped up spring fashions at clothing chains and
> department stores, according to the Goldman Sachs retail composite index.
> ... (New York Times, page C19)_____Retailers posted reasonably strong
> April sales, though some analysts saw the results as a faint pullback from
> the shopping spree that has lasted more than a year. ... (Wall Street
> Journal, page B4)
>
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