August 2002, Vol. 125, No. 8
Labor month in review
Regional trends in 2000
Veterans in the labor force
The August Review
The number of poor increased by 1.3 million people in 2001, according to data recently released by the Census Bureau. This underscores the continuing need to carefully evaluate and improve our measures of poverty. Kathleen Short and Thesia I. Garner use Consumer Expenditure Survey data to explore how accounting differently for out-of-pocket medical expenses may affect poverty measurements. The two alternate poverty measures they look atóone subtracts medical out-of-pocket expenses from income, the other adds them to the poverty thresholdówould have added 1- to 1.5-percentage points to the official poverty rate for 2000.
Joe G. Baker uses economic analysis to understand the rapid increase in the number of women entering the legal profession. He points out that in 2001, there were more women than men entering law schools. He attributes the attraction of the profession to factors such as high earnings early in the career and relatively easy re-entry after periods of nonparticipation in the labor force.
Ming Lu, Jianyong Fan, Shejian Liu, and Yan Yan provide a survey of recent employment trends in China. In addition to documenting a shift away from agricultural and extractive primary industries and toward the goods-producing and service-providing secondary and tertiary sectors, the authors provide a number of interesting details on the educational profile of the workforce, the demographic structure of employment, and the changing relationship between private and public ownership in China.
Regional trends in 2000
The proportion of the population with jobs was the highest in the Midwest in 2000. Among Midwesterners, 67.4 percent of the population was employed on average in 2000. The percentages for the other three regions were clustered within a narrow range: 64.7 percent of those in the West were employed, 63.4 percent in the South, and 62.8 percent in the Northeast. In the Nation as a whole, 64.5 percent of the population had jobs.
Regional unemployment rates varied from a low of 3.7 percent in the Midwest to 4.6 percent in the West region. Workers unemployed for 27 weeks or more made up 14.3 percent of the total unemployed in the Northeast. This was nearly 3 percentage points higher than in any of the other broad geographic regions. In the West, 11.5 percent of the unemployed were in a spell of unemployment that had lasted 27 weeks or more. Such long durations of unemployment accounted for 10.8 percent of those unemployed in the South and 9.8 percent of those in the Midwest.
A new Job Openings and Labor Turnover Survey (JOLTS) was introduced in July 2002 by the Bureau of Labor Statistics. Job openings are a measure of unmet labor demand and may be compared with unemployment, which measures unused labor supply. Job openings refer to the number on the last business day of the month, and the number of hires and separations are for the entire month. The sample of 16,000 business establishments covers both the private sector and government.
The first release of JOLTS estimates covered the period from May 2001 to May 2002 and showed that the number and rate of job openings in May 2002 were substantially lower than a year earlier. On the last business day of May 2002, there were 3.5 million job openings, 2.6 percent of the number of total filled and unfilled positions (employment plus job openings) in the United States. This was down significantly from 4.3 million openings, or a job openings rate of 3.2 percent, in May 2001. Over the same period, the total U.S. unemployment rate (not seasonally adjusted) rose to 5.5 percent from 4.1 percent.
The pace of hiring also declined compared with a year ago. The hires rate, or the number of hires during the month divided by employment, was 3.7 percent in May 2002, down significantly from 4.3 percent a year earlier. Hires are any additions to the payroll during the month.
The total separations, or turnover, rate (the number of separations during the month divided by employment) was 3.1 percent in May 2002, down significantly from 3.7 percent a year ago. Separations are terminations of employment that occur at any time during the month. Total separations includes quits (voluntary separations), layoffs and discharges (involuntary separations), and other separations (including retirements).
Hires and separations estimates help show dynamic flows in the labor market that net changes in the employment level do not. Over the year ended in May 2002, employment declined by 1.4 million. Over the same period, 52.3 million hires and 52.9 million separations occurred at U.S. businesses. For more information see the Job Openings and Labor Turnover Survey page at http://www.bls.gov/jlt/home.htm.
Veterans in the labor force
Two-thirds of veterans discharged from active duty between 1998 and 2001 were ages 18 to 34. These young recently discharged veterans had a labor force participation rate of 84.9 percent, and an unemployment rate of 4.4 percent in August 2001. Nonveterans of the same age had a labor force participation rate of 85.7 percent, and an unemployment rate of 6.7 percent.
In August 2001, 76.6 percent of male veterans of the Vietnam era were in the labor force. Among male Vietnam-era veterans, 91 percent were between 45 and 64 years of age in August 2001. Their nonveteran peers had a labor force participation rate of 82.2 percent.
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