TEXT

 
 
 
                                       FOR DELIVERY: 9:30 A.M., E.S.T.
                                       FRIDAY, JANUARY 6, 1995
 
 
 
           ___________________________________________________________
           Advance copies of this statement are made available to the
           press under lock-up conditions with the explicit
           understanding that the data are embargoed until 8:30 a.m.
           Eastern time.  ____________________________________________
 
 
                                   Statement of
 
                               Katharine G. Abraham
                                   Commissioner
                            Bureau of Labor Statistics
 
                                    before the
 
                             Joint Economic Committee
 
                              UNITED STATES CONGRESS
 
                                 January 6, 1995
 
 
 
           Mr. Chairman and Members of the Committee:
 
                I appreciate this opportunity to comment on the labor
 
           market data released earlier this morning.
 
                December data sustained the pattern of labor market
 
           improvements that was fairly pervasive throughout 1994.
 
           Payroll employment continued to advance, increasing by
 
           256,000 over the month.  Unemployment remained on its
 
           downward trend; at 5.4 percent, the unemployment rate was
 
           1.3 percentage points below its level at the beginning of
 
           1994.
 
                December's gain in employment, as measured by our
 
           survey of businesses, brings the increase in payroll jobs
 
           for all of 1994 to 3-1/2 million.  This exceeded the prior
 
                                        -2-
 
 
           year's gain by over a million and was the largest in the
 
           past decade.
 
                Factory employment rose by 54,000 in December, with
 
           gains widespread throughout the individual manufacturing
 
           industries.  The largest increases occurred in fabricated
 
           metals and electronic equipment.  Manufacturing job growth
 
           totaled nearly 300,000 for the year as a whole, compared
 
           with a loss of 130,000 in 1993.  The extraordinarily high
 
           levels of weekly hours and overtime during 1994 provide
 
           additional evidence of the strength in the demand for labor
 
           in manufacturing.  Although construction employment showed
 
           little movement in December, for all of 1994, employment in
 
           the industry rose by about 300,000, the largest annual gain
 
           in 10 years.
 
                The services industry added 110,000 jobs in December,
 
           with increases in business, health, and social services.
 
           Over the year, employment growth in services totaled 1.6
 
           million.  Retail trade also had substantial employment gains
 
           both in December (91,000) and over the year (nearly
 
           800,000).  Most of December's gain was in eating and
 
           drinking places, which appear to have had a strong holiday
 
           season.  Holiday-related increases in package delivery and
 
           traveling lie behind the December employment increase in the
 
           transportation industry, and holiday-related shipping also
 
           contributed to an over-the-month gain in Federal government
 
           (postal) employment.  Over the year, however, the number of
 
                                        -3-
 
 
           Federal jobs has declined by about 50,000 (and would have
 
           declined even more had the Postal Service been excluded).
 
           Local governments (excluding education) shed 57,000 jobs in
 
           December, as workers brought on for the November elections
 
           were no longer on the payrolls.  Absent the inclusion of
 
           these temporary positions in the November job count, the
 
           December employment increase would have been larger and that
 
           for November correspondingly smaller.
 
                As is our normal practice at the end of the year, the
 
           seasonally adjusted estimates from the household survey have
 
           been revised to reflect updated seasonal factors.  Because
 
           of the major redesign of the household survey that was
 
           implemented in January 1994, this year we have revised only
 
           data for the last 12 months.
 
                Like the estimates from the employer survey, the
 
           household survey data show substantial improvement in the
 
           labor market during 1994.  As I mentioned earlier, the
 
           unemployment rate dropped 1.3 percentage points from 6.7
 
           percent in January to 5.4 percent in December, as the number
 
           of unemployed persons declined by 1.6 million.  Jobless
 
           rates improved during the year for adults and teenagers as
 
           well as for whites, blacks, and Hispanics.  In addition, the
 
           number of persons working part time when they would have
 
           preferred full-time work declined by nearly 650,000.  Since
 
           January, total employment has risen by 2.7 million, raising
 
           the proportion of the population with jobs to a very high
 
                                        -4-
 
 
           63.0 percent.  The labor force rose by 1.1 million over the
 
           January-December period.
 
                In summary, the labor market showed strength in
 
           December as it did throughout 1994.  Employment, as measured
 
           by both of our monthly surveys, has increased substantially
 
           over the year and unemployment has fallen.
 
 
 
                My colleagues and I now would be glad to answer any
 
           questions you might have.