December 1997 Employment Situation

Historical release narrative reproduced from the official public-domain source. Statistical tables, standard technical appendices, administrative material and attendance rosters are omitted; formatting is adapted for reading. Figures retain the release's historical context and may have been revised. Consult the linked source for the complete document.

Nonfarm payroll employment rose substantially in December, following a similar increase in November, and the unemployment rate was about unchanged at 4.7 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Nonfarm payroll employment grew by 370,000, with gains occurring in most industry divisions.

Unemployment (Household Survey Data)

Both the number of unemployed persons, 6.4 million, and the unemployment rate, 4.7 percent, were essentially unchanged in December, after seasonal adjustment. A year earlier the rate had been 5.3 percent. The jobless rate for adult men returned to 4.1 percent in December after falling to 3.9 percent in November. The unemployment rates for other major worker groups--adult women (4.0 percent), teenagers (14.3 percent), whites (3.9 percent), blacks (9.9 percent), and Hispanics (7.5 percent)--showed little or no change over the month. (See tables A-1 and A-2.)

Total Employment and the Labor Force (Household Survey Data)

Total employment was about unchanged in December, at 130.8 million (seasonally adjusted), following a substantial increase in November. The number of employed persons has increased by 2.6 million since December 1996, after adjusting for the change in the population controls made in January 1997. The proportion of the population with jobs, the employment- population ratio, was at an all-time high of 64.1 percent. (See table A-1.)

About 8.1 million persons (not seasonally adjusted) held more than one job in December. These multiple jobholders made up 6.2 percent of all employed persons. (See table A-9.)

Both the civilian labor force, 137.2 million (seasonally adjusted), and the labor force participation rate, 67.2 percent, were essentially unchanged over the month. (See table A-1.)

Persons Not in the Labor Force (Household Survey Data)

About 1.5 million persons (not seasonally adjusted) were marginally attached to the labor force in December. These were people who wanted and were available for work and had looked for a job sometime in the prior 12 months but were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

The number of discouraged workers--a subset of the marginally attached who were not currently looking for jobs specifically because they believed no jobs were available for them--was 345,000 in December, virtually the same as a year earlier. (See table A-9.)

Industry Payroll Employment (Establishment Survey Data)

Nonfarm payroll employment rose by 370,000 in December to 123.9 million, after seasonal adjustment; over the year, payroll employment increased by 3.2 million. In December, services had the largest job gain, and growth continued in most other industries, including manufacturing and construction. (See table B-1.)

Manufacturing employment increased by 39,000 in December, bringing the total job gain for 1997 to 230,000. In December, growth continued for industrial machinery and equipment, aircraft and parts, electronic components and accessories, and fabricated metals. These industries added a total of 189,000 jobs over the year. Several construction-related industries also had notable increases in December; in fact, lumber and wood products had the largest job gain in manufacturing. Employment in motor vehicles and equipment declined by 9,000 in December but increased by 25,000 over the year.

The construction industry posted a substantial job gain for the second straight month. The increase of 50,000 jobs in December brought the total gain for 1997 to 209,000, not quite as robust as the 289,000 added in the prior year. In December, special trade contractors showed the largest gain (25,000), and heavy construction had its first increase (11,000) since August.

Within the service-producing sector, employment in the services industry rose by 181,000 in December. Business services accounted for nearly half of this growth, with strong gains in both personnel supply services (45,000) and computer and data processing services (17,000). In personnel supply, both help supply services and employment agencies contributed to the increase. Computer services accounted for 1 in every 20 jobs added in 1997. In December, health services had an above-average gain (26,000), as hospital employment rose by 12,000. Engineering and management services also showed a large increase (26,000) in December; like computer services, this small industry accounted for a relatively large share of job growth in 1997.

Retail trade employment rose by 52,000 in December, with nearly all of the growth occurring in eating and drinking places and miscellaneous retail establishments. Employment in department stores was essentially unchanged, after seasonal adjustment, following a 34,000 increase in November.

Employment in finance, insurance, and real estate increased by 23,000. Commercial banks and security and commodity brokerages continued their steady growth, and the insurance industry rounded out its strongest quarter in over a decade by adding 12,000 jobs. Employment growth also continued in wholesale trade with widespread increases in durable goods distribution. In the communications industry, job growth has picked up recently, with an increase of 6,000 in December and gains totaling 22,000 in the fourth quarter. Telephone communications accounted for the recent strength. In contrast, transportation employment declined in November and December, following gains totaling 182,000 during the first 10 months of the year. While the trucking industry has contributed to this recent weakness, December's drop reflected an employment decline in air courier services.

In December, state and local government employment continued to trend upward, while federal employment continued its downward drift.

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls decreased by 0.2 hour in December to 34.6 hours, seasonally adjusted, reversing most of the prior month’s increase. The manufacturing workweek increased by 0.2 hour to 42.3 hours, a post-World War II high, and factory overtime remained at 4.9 hours. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls decreased by 0.2 percent to 142.5 (1982=100), seasonally adjusted. The manufacturing index rose by 0.6 percent to 110.2. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

Average hourly earnings of production or nonsupervisory workers on private nonfarm payrolls edged up 1 cent in December to $12.48, seasonally adjusted. Average weekly earnings decreased by 0.5 percent to $431.81, reflecting the decline in weekly hours. Over the year, average hourly earnings rose by 3.7 percent and average weekly earnings by 3.4 percent. (See table B-3.)

Revision of Seasonally Adjusted Household Survey Data

At the end of each calendar year, BLS routinely updates the seasonal adjustment factors for the labor force series derived from the Current Population Survey (also referred to as the household survey) to incorporate the experience of that year. This year, seasonally adjusted data for January 1994-December 1997 are subject to revision. (Seasonally adjusted establishment data will be revised in June, concurrent with the introduction of annual benchmark adjustments.)

The January 1998 issue of Employment and Earnings will contain the new seasonal adjustment factors for major series for the January-June 1998 period. The publication also will contain a description of the current seasonal adjustment methodology and revised data for the most recent 13 months or quarters for all regularly published tables containing seasonally adjusted household survey data. Historical seasonally adjusted monthly and quarterly data also are available on the Internet. Internet users can access these data from the ftp://ftp.bls.gov/pub/special.requests/lf directory. Historical data for the household series contained in the "A" tables of this release also can be accessed at the end of the Employment Situation news release on the BLS internet site.

1/ Not published.

Planned Changes in the Household Survey Data Effective with the release of data for January 1998, improvements will be introduced into the composite estimation procedures used in the household survey. These changes will simplify processing of the monthly labor force data at BLS and will allow users of the survey microdata to replicate more easily the official estimates released by BLS. In addition, there will be a slight decrease in the variance of some major estimates, particularly employment levels and the over-the-month change in those levels. The new procedures are expected to produce somewhat lower estimates of the civilian labor force and employment. Also effective with the release of January data, minor revisions will be introduced into the population controls used for the household survey. These changes and their effect on the estimates of labor force change and composition will be described in an article in the February 1998 issue of Employment and Earnings.

Next month's release also will introduce a new table showing labor force data for persons 25 years and over by major educational attainment categories.

HOUSEHOLD DATA HOUSEHOLD DATA

1996 1997 Employment status, sex, and age Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

TOTAL

Men, 20 years and over

Women, 20 years and over

Both sexes, 16 to 19 years

1 The population figures are not adjusted for seasonal variation. NOTE: Beginning in January 1997, data reflect revised population controls used in the household survey. Seasonally adjusted data have been revised based on the experience through December 1997.