BLS DAILY REPORT, MONDAY, NOVEMBER 18, 1996 "A Fairer Way to Figure Social Security" by Alan B. Krueger, professor of economic and public affairs at Princeton's Woodrow Wilson School of Public and International Affairs, appears on the op. ed. page of the Washington Post ....Krueger writes, "Reducing the Consumer Price Index, which is used to adjust benefits for inflation, is frequently proposed to rescue Social Security and balance the budget. There may even be sound economic reasons to suspect the CPI overstates the true cost of living. But any adjustment to the CPI should be represented primarily as a budget decision, not as a correction for a known failure of the CPI. I doubt we will ever reach consensus on the overstatement of the CPI, or how to fix it, so instead we should index Social Security to the wages of American workers" ....He asks, "What should be done? There are reasons to doubt whether increases in the CPI adequately measure increases in the cost of living. But knowing these reasons is far from being certain of the extent by which changes in the CPI overstate changes in the cost of living. BLS always has pointed out that the CPI is designed to measure the price of a fixed bundle of goods, not necessarily the true cost of living. The integrity of all government statistics would be strained if pressure were put on the BLS to make adjustments that it deems unwise or premature. One way of skirting this issue, while improving the solvency and fairness of Social Security, would be to index Social Security benefits to wage growth. If wages grow by 2.9 percent a year, then Social Security benefits would grow by 2.9 percent as well, regardless of the change in the CPI. There are several arguments for wage indexation. First, wage indexation is fair ....Second, wage indexation makes economic sense ....Third, wage indexation could help put Social Security on sound financial footing ....Fourth, precedent for wage indexation exists in Social Security ....Indexing Social Security to the CPI was a bad idea from the beginning. Rather than asking Congress to make an arbitrary adjustment to the CPI, or pressuring the BLS to adopt procedures of uncertain scientific validity, thought should be given to indexing Social Security to wage growth." The Business Roundtable's construction committee's national construction conference announced preliminary results of its skilled labor shortages survey conducted this summer. The survey confirms other industry reports that the shortage of skilled craftsmen is serious and -- in the face of robust conditions in the industry -- likely to become more pronounced. The roundtable is an association of more than 200 chief executives of major U.S. corporations ....(Daily Labor Report, page A-8). Good help gets scarce as yuletide draws near. Low unemployment makes hiring rough ....Retailers hoped to hear only the jingle of busy cash registers this holiday season after last month's unexpectedly strong sales. But they may also be hearing the grumbles of customers waiting in long lines as store managers scramble to find seasonal workers. The same factors that caused a surge in October receipts -- the stronger economy and lower unemployment -- also mean applicants can afford to be more choosy about jobs ....(Washington Times, page A1). Job cuts caused by mergers have fallen 33 percent so far this year from the same period a year ago, according to Challenger, Gray & Christmas Inc. Of the 410,208 layoffs announced through the first 10 months of the year, 37,530, or 9 percent, were caused by mergers. In the first 10 months of last year, 56,674 job cuts, or 16.5 percent of the total 343,352, were merger related ....(Washington Post, Nov. 17, page H4). California is about to become the first state to protect workers from injuries caused by repetitive worker, such as typing on keyboards or working on an assembly line. After two years of debate and a court order, the state's Occupational Safety and Health Standards Board voted unanimously to approve the regulation ....Under it, employers must evaluate the work site, control exposure to the injury-causing routine, and implement a program designed to minimize the problem ....A 1994 state report shows 31,800 California workers reported repetitive motion injuries. The painful disorder, which once was mainly a problem of meat-cutters and assembly-line workers, has become more pervasive with the widespread use of computer keyboards ....(Daily Labor Report, page A-12; Washington Post, Nov. 17, page H4).
