July 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.

Payroll employment rose slightly, and unemployment was unchanged in July, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Nonfarm payroll employment edged up by 66,000 to 125.8 million, as growth was curtailed by strikes and plant shutdowns in automobile-related manufacturing. The jobless rate remained at 4.5 percent.

Unemployment (Household Survey Data)

The number of unemployed persons, 6.2 million in July, was little changed over the month. The unemployment rate remained at 4.5 percent; it has been below 5.0 percent since July 1997. The jobless rate for whites edged down by 0.2 percentage point to 3.8 percent, about the same as in May. The jobless rate for blacks increased over the month to 9.7 percent. Unemployment rates for the other major demographic groups--adult men (3.9 percent), adult women (4.0 percent), teenagers (13.8 percent), and Hispanics (7.2 percent)--were essentially unchanged in July. (See tables A-1 and A-2.)

The number of unemployed persons on temporary layoff--those who have been given a date to return to work or expect to return within 6 months-- increased by 125,000 over the month to 966,000, reflecting the plant shutdowns in automobile-related manufacturing. The unemployment rate in durable goods manufacturing rose from 2.9 to 4.3 percent. (See tables A-5 and A-7.)

Total Employment and the Labor Force (Household Survey Data)

Total employment was essentially unchanged over the month at 131.1 million. The employment-population ratio--the proportion of the population age 16 and older with jobs--was 63.9 percent, little changed from the previous month’s rate. (See table A-1.)

About 7.6 million persons (not seasonally adjusted) held more than one job in July. These multiple jobholders comprised 5.8 percent of total employment. In both June and July, the multiple jobholding rate was lower than it had been a year earlier. (See table A-10.)

The civilian labor force was about unchanged at 137.3 million in July. The labor force participation rate was 66.9 percent, down from its all-time high of 67.3 percent at the beginning of the year. (See table A-1.)

Persons Not in the Labor Force (Household Survey Data)

About 1.3 million persons (not seasonally adjusted) were marginally attached to the labor force in July. 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. (See table A-10.)

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 374,000 in July, slightly higher than a year earlier.

Industry Payroll Employment (Establishment Survey Data)

Nonfarm payroll employment edged up by 66,000 in July, after seasonal adjustment. A large strike-related decline in manufacturing partly offset a substantial increase in retail trade and gains in other service-producing industries and construction. (See table B-1.)

Manufacturing employment fell by 176,000, as two strikes and related parts shortages led to plant shutdowns in several auto-related industries. (Persons on strike or on layoff for the entire survey reference period are not on payrolls and, thus, are not counted as employed in the establishment survey.) Employment in motor vehicles and equipment was down by 111,000 jobs; other declines at least partly attributable to the strikes (which were settled after the survey reference period) occurred in primary metals (-14,000), industrial machinery (-13,000), fabricated metals (-10,000), rubber and miscellaneous plastics (-7,000), and apparel and other textiles (-4,000). Manufacturing industries that had job losses unrelated to the strikes included food products (-9,000), electronic components (-7,000), and textile mill products (-5,000).

Construction added 18,000 jobs in July and has added 238,000 jobs since October. Mining employment fell by 5,000, with the losses occurring in oil and gas extraction.

A large increase in retail trade employment (125,000) reflected unusual strength in eating and drinking places (up 69,000), where growth has accelerated after a weak first quarter. Also contributing to the increase in retail trade were food stores and miscellaneous retail establishments, with gains of 16,000 jobs each, and building materials and garden supply stores and furniture stores, which added 6,000 jobs each. In wholesale trade, employment was essentially flat for the second month in a row.

Finance, insurance, and real estate continued its strong growth trend, adding 32,000 jobs in July. All three components contributed to the gain. In finance, employment rose by 18,000, with security and mortgage brokerages accounting for most of the growth. Insurance continued to add jobs (8,000), and real estate employment grew by 6,000, following little change in the prior 2 months.

Transportation and public utilities added 18,000 jobs in July. All of the gain was in transportation, which had experienced little growth in the prior month. The largest increases were in trucking, local and interurban passenger transit, and water transportation.

Employment in services grew by 65,000 in July, only about half the average gain for the previous 12 months. Help supply services had a decline of 33,000 jobs, some of which was attributable to the shutdowns in the auto industry. Health services, which typically adds jobs each month, did not grow in July. Job losses in home health care and nursing homes offset gains in doctors’ offices and hospitals. Elsewhere in the services industry, robust growth continued in engineering and management services (26,000) and computer services (20,000). Amusement and recreation services and hotels and other lodging places also added jobs over the month.

Government employment was little changed overall in July. Local government except education showed a decline of 18,000, as summer hiring was lighter than usual, and federal employment continued its long-term downward trend. An increase in state government employment mainly reflected a return to payrolls of public transportation workers following the settlement of a strike.

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls was unchanged in July at 34.6 hours, seasonally adjusted. The manufacturing workweek edged down by 0.1 hour to 41.7 hours, while factory overtime rose by 0.2 hour to 4.8 hours. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls increased by 0.3 percent to 145.2 (1982=100), seasonally adjusted. The manufacturing index fell by 1.6 percent to 107.3, reflecting in large part the effects of the strikes and layoffs in the auto-related industries. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

Average hourly earnings of production or nonsupervisory workers on private nonfarm payrolls rose by 3 cents in July to $12.79, seasonally adjusted. Average weekly earnings increased by 0.2 percent to $442.53. Over the year, average hourly and weekly earnings have risen by 4.2 and 4.5 percent, respectively. (See table B-3.)