TEXT FOR DELIVERY: 9:30 A.M., E.S.T. FRIDAY, NOVEMBER 4, 1994 ___________________________________________________________ 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 November 4, 1994 Good morning. I would like to take this opportunity to add a few comments to supplement this morning's Employment Situation news release. My colleagues and I will be happy to answer your questions at the conclusion of my remarks. The nation's labor market continued to improve in October. Both our household and establishment surveys showed further job gains. While the unemployment rate, at 5.8 percent, was little changed over the month, it has declined by nearly a full percentage point since January. The number of payroll jobs rose by 194,000 in October, somewhat below the average monthly growth so far this year. A gain of 40,000 jobs in manufacturing brought to 200,000 the industry's gain since its recovery began 13 months ago. Autos, fabricated metals, and several other durable goods -2- manufacturing industries added jobs in October. There also appears to have been some moderation of job declines in defense-related industries, particularly aircraft and instruments. Average weekly hours for production workers in manufacturing edged up in October. The factory workweek, at 42.1 hours, remains at a level not seen since the end of World War II. The largest over-the-month gain was in the services industry, which added 96,000 jobs. For the second month in a row, however, job growth in services (including that in business services) was somewhat below the average for this year. Broad-based job gains in retail trade featured increases among auto dealers, furniture stores, and general merchandise stores. Wholesale trade, which had solid gains over the prior 2 months, showed additional growth in October. Employment in construction and the other major industry groups changed little in October. Turning to data from our survey of households, total employment showed a large gain for the third month in a row, after lagging earlier in the year. This brings the growth in total employment since January of this year more in line with the strong gains in nonfarm jobs registered by the payroll survey. The labor force also has expanded markedly over the past 3 months, after showing no net growth between January and July. Over the 9-month period since January, the labor -3- force has risen by 1.2 million, about in line with growth in the working-age population. During that span, the number of unemployed persons has declined by 1.1 million to 7.6 million, and the jobless rate has declined from 6.7 to 5.8 percent. The unemployment rate for adult women fell from 6.0 to 5.0 percent, and that for adult men from 5.9 to 5.1 percent. The teenage rate has moved somewhat erratically this year and, at 17.3 percent in October, is slightly below the January figure. Jobless rates for whites, blacks, and Hispanics all have declined since January. In summary, the job market continues to improve. Employment, as measured by both our household and establishment surveys, rose in October, and the unemployment rate has trended downward to 5.8 percent. Since January, there has been marked employment growth and the jobless rate has declined by nearly 1 percentage point. The upcoming 1994 payroll employment benchmark revision Once a year, the Bureau adjusts the payroll survey's sample-based employment estimates to incorporate the previous year's March universe employment counts in a process known as benchmarking. These universe employment counts are derived principally from State unemployment insurance (UI) tax reports that nearly all employers are required to file. By early November of each year, we typically have completed preliminary tabulations of these -4- universe counts for the first quarter of the year, which we routinely share at the time we release our October Employment Situation report. Preliminary 1994 first quarter universe tabulations suggest that there was stronger job growth than we previously reported for the 12-month period ending in March 1994. Indications at this time are that the March 1994 payroll employment estimate will be revised upward by approximately 760,000, or 0.7 percent. The historical average for benchmark revisions over the past decade has been plus or minus 0.2 percent, with revisions ranging in size from zero to 0.6 percent. Final benchmark adjustments for March 1994 are scheduled to be formally introduced next June. In the interim, BLS will continue to validate the UI universe counts and other benchmark source material. At this time, it appears that approximately one-quarter of the total benchmark revision stems from an updated estimate of employment in the sectors not covered by the UI universe tabulations, for which employment counts must be developed from alternative sources. Over the coming months, BLS will continue a program of research that will help us to understand the causes for this year's revision. My colleagues and I now would be glad to answer any questions you might have.