May 1998 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 in May, and the unemployment rate remained at 4.3 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Nonfarm payroll employment increased by 296,000 with all the growth occurring in the service-producing sector. The number of manufacturing jobs fell, and construction employment edged down.

Unemployment (Household Survey Data)

The number of unemployed persons, 5.9 million in May, was little changed over the month, and the unemployment rate held at 4.3 percent. Both measures had fallen sharply in the previous month. Among the major demographic groups, the rates for adult men (3.5 percent), adult women (3.9 percent), teenagers (14.2 percent), whites (3.7 percent), blacks (9.0 percent), and Hispanics (6.8 percent) were essentially unchanged in May. (See tables A-1 and A-2.)

The unemployment rates for persons 25 years and older with less than a high school diploma (6.7 percent), high school graduates with no college experience (3.7 percent), and college graduates (1.6 percent) showed essentially no movement over the month. The jobless rate for persons with some college experience but no bachelor's degree rose by 0.4 percentage point to 3.1 percent in May. (See table A-3.)

Total Employment and the Labor Force (Household Survey Data)

Total employment was essentially unchanged at 131.5 million. The employment-population ratio--the proportion of the population age 16 and older with jobs--was 64.2 percent. It has remained at or near this record level since January. (See table A-1.)

About 8.1 million persons (not seasonally adjusted) held more than one job in May. These multiple jobholders comprised 6.2 percent of the total employed. (See table A-10.)

The civilian labor force, 137.4 million, was about unchanged in May, after seasonal adjustment. The labor force participation rate held at 67.0 percent. (See table A-1.)

Persons Not in the Labor Force (Household Survey Data)

About 1.2 million persons (not seasonally adjusted) were marginally attached to the labor force in May. 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 work specifically because they believed no jobs were available for them--totaled 268,000 in May, down from 338,000 a year earlier. (See table A-10.)

Industry Payroll Employment (Establishment Survey Data)

Nonfarm payroll employment rose by 296,000 in May, after seasonal adjustment, due to a large increase in the service-producing sector. Employment in the goods-producing sector declined, with widespread losses in manufacturing and a small decline in construction. (See table B-1.)

Manufacturing employment fell by 26,000 in May, after 3 months of little change. The largest decrease was in the apparel industry, which continued its long-term decline with a loss of 9,000 jobs. Most other industries experienced small employment losses over the month. Employment in both electronic components and industrial machinery declined for the second month in a row; these industries had added jobs steadily during 1997. In contrast, the furniture and fixtures industry continued its recent growth, adding 3,000 jobs in May, and employment in chemicals and allied products also rose by 3,000.

Construction employment edged down by 9,000 in May, after seasonal adjustment. This follows strong growth (204,000) from October to April.

Within the service-producing sector, the services industry added 151,000 jobs in May. This growth followed 3 months of gains that were well below the 1997 average of 142,000. Business services accounted for half of the May increase, with help supply services and computer services adding 26,000 and 17,000 jobs, respectively. This was the first gain for the help supply industry since February. Engineering and management services continued to grow, adding 25,000 jobs, with a sharp gain (16,000) in management and public relations. Employment in health services increased by 17,000 in May, after weak growth in the prior month.

Employment in retail trade grew by 89,000 in May, the second large increase in a row. Gains were widespread throughout the industry, with sizable growth occurring within eating and drinking places (33,000), department stores (28,000), and miscellaneous retail establishments (18,000). In contrast, wholesale trade gained 9,000 jobs, compared with the average increase of 15,000 in the prior 12 months. The 3,000 employment gain in durable goods distribution was the smallest in nearly 5 years.

Transportation added 17,000 jobs in May, following a much smaller increase (3,000) in April. Employment in local and interurban passenger transit grew by 7,000, offsetting a decline of similar magnitude in the previous month. Communications added 6,000 jobs in May, reflecting continuing growth in the telephone industry.

Finance, insurance, and real estate added 20,000 jobs over the month, mostly in finance. Within finance, mortgage brokerages had the largest job gain (5,000) and has grown by 13 percent over the past 12 months. Security brokerages also continued steady growth, adding 3,000 jobs over the month. Insurance employment rose by 6,000 in May. Real estate employment edged down over the month, after adding 31,000 jobs from December through April.

Government payrolls rose by 41,000 in May, mainly due to an increase in local education (28,000) that was well above the industry's average for the past year. State government also had stronger-than-usual growth in May, spread about equally between the education and noneducation components. Declines continued in federal government employment.

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls increased by 0.2 hour in May to 34.7 hours, seasonally adjusted. The manufacturing workweek rose by 0.3 hour to 41.7 hours, but is a half hour below its peak level reached last December. Factory overtime edged up by 0.1 hour in May to 4.6 hours; however, overtime hours have trended down in recent months. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls increased by 0.7 percent to 144.9 (1982=100), seasonally adjusted. The manufacturing index rose by 0.5 percent to 109.1. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

Average hourly earnings of production or nonsupervisory workers on private nonfarm payrolls increased 4 cents in May to $12.73, seasonally adjusted. Average weekly earnings increased by 0.9 percent to $441.73. Over the year, average hourly and weekly earnings both rose by 4.3 percent. (See table B-3.)

Revisions to Establishment Survey Data

In accordance with annual practice, the establishment survey data have been revised to reflect comprehensive universe counts of payroll jobs (benchmarks). These counts are derived principally from unemployment insurance tax records for March 1997; the benchmark process resulted in revisions to all not seasonally adjusted data series from April 1996 forward, the time period since the last benchmark was established. Seasonally adjusted employment series for all employees and women, beginning with January 1993, also have been revised, in accordance with the usual 5-year revision practice. Seasonally adjusted series for hours, indexes of aggregate weekly hours, and earnings for production or nonsupervisory workers have been revised from 1989 forward to incorporate an improved design that mitigates the effects of response and processing errors in reports from respondents with semi-monthly and monthly payrolls. Seasonally adjusted employment levels for production or nonsupervisory workers also have been revised from 1989 forward.

The June 1998 issue of Employment and Earnings will contain an article that discusses the benchmark and post-benchmark revisions. This issue also will provide revised seasonal adjustment factors for March through October 1998 and revised estimates for all regularly published tables containing national establishment survey data on employment, hours, and earnings.

The BLS public database on the Internet, LABSTAT, contains all historical data revised as a result of this benchmark, and updated seasonal adjustment factors. The data can be accessed through the Current Employment Statistics (CES) home page at http://stats.bls.gov/ceshome.htm.

Further information on the revisions released today may be obtained by calling 202-606-6555.