June 2001 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 fell by 114,000 in June, and the unemployment rate was little changed, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Manufacturing experienced another large job loss, and wholesale trade employment declined for the third consecutive month. Other major industry groups showed no significant change in employment over the month.

Unemployment (Household Survey Data)

Both the unemployment rate (4.5 percent) and the number of unemployed per- sons (6.4 million) were little changed in June. In each of the past 3 months, the jobless rate has been either 4.4 or 4.5 percent; its most recent low was 3.9 percent in October 2000. The rates for all the major worker groups--adult men (4.0 percent), adult women (3.8 percent), teenagers (14.3 percent), whites (4.0 percent), blacks (8.4 percent), and Hispanics (6.6 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, at 134.9 million, was little changed in June. Since Jan- uary, it has declined by about 1.1 million. Over the month, the employment- population ratio decreased to 63.7 percent and has fallen by 0.8 percentage point since January.

The civilian labor force (141.4 million) was essentially unchanged over the month, after seasonal adjustment, and the labor force participation rate--the proportion of the population 16 years of age and older who are either working or looking for work--remained at 66.8 percent. Since January, the participation rate has declined by half a percentage point. (See table A-1.)

The number of persons working part time for economic reasons increased by 266,000 to 3.6 million. This was about half a million more than a year earlier. These persons indicated that they would like to work full time but worked part time because their hours had been cut back or they were unable to find a full-time job. (See table A-4.)

In June, 7.3 million persons (not seasonally adjusted) held more than one job. These multiple jobholders represented 5.4 percent of the employed, the same as a year earlier. (See table A-10.)

Persons Not in the Labor Force (Household Survey Data)

In June, 4.6 million people not in the labor force (seasonally adjusted) reported that they currently wanted a job. These individuals are not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. Indeed, most had not searched for work in the prior year. (See table A-1.) Among persons who wanted a job, about 1.2 million (not seasonally adjusted) were marginally attached to the labor force in June. These were people who were available for work and had looked for a job sometime in the prior 12 months. In June, the number of discouraged workers was 291,000. Discouraged workers, a subset of the marginally attached, were not currently looking for work specifically because they believed no jobs were available for them. (See table A-10.)

Industry Payroll Employment (Establishment Survey Data)

Nonfarm payroll employment fell by 114,000 in June to 132.4 million, seasonally adjusted. This was the second decline in the past 3 months (as revised) and brought total job losses in the second quarter to 271,000. Manufacturing employment continued to fall sharply in June, and related industries such as wholesale trade and transportation also lost jobs. The other major industry groups had little or no change in employment over the month. (See table B-1.)

Manufacturing lost 113,000 jobs in June. Since last July, the industry has lost 785,000 jobs, with nearly three-quarters of the decline coming since the end of 2000. In June, employment losses in manufacturing again were widespread, with the largest declines occurring in electronic equip- ment (31,000), industrial machinery (22,000), and fabricated metals and textiles (8,000 each). Job losses in electronic equipment and industrial machinery have accelerated over the past 3 months, as they also have in textiles, furniture, and printing and publishing.

Construction employment was little changed in June and was down over the second quarter (seasonally adjusted). Strong job growth in the first quarter may have lessened the need for the industry to add workers during the spring buildup. Monthly job growth in the industry has averaged 15,000 thus far in 2001, slightly below the average monthly growth for all of 2000.

In mining, employment continued to rise in oil and gas extraction, although June's gain was the smallest this year.

In the service-producing sector, employment in wholesale trade decreased sharply for the third consecutive month. Employment declines in this industry have totaled 42,000 since March, reflecting cutbacks in both domestic indus- trial production and imports.

Employment in transportation and public utilities declined by 11,000 in June. All of the loss occurred in transportation. Manufacturing's severe downturn continued to affect the movement of goods both by truck and air. Employment in air transportation also has been affected by reductions in business travel.

Employment in services was flat in June, following a gain of 65,000 (as revised) in May. Strong job gains in health services, engineering and management services, motion pictures, and computer services were offset by large losses in help supply services, hotels, amusements and recreation, and educational services. Since reaching its peak last September, the help supply industry has lost 379,000 jobs.

Employment in finance, insurance, and real estate was little changed in June. Employment gains continued in commercial banks and in mortgage banks; these were offset by declines in insurance and real estate and continued losses in security brokerages, which have shed 12,000 jobs since March.

In June, employment in retail trade also was little changed. Job gains in eating and drinking places and building materials and garden supplies were partially offset by continued losses in food stores. Job gains in retail trade have averaged 24,000 a month in 2001, about the same as the monthly average for all of last year.

In government, small job gains in state and local government more than offset losses in the federal government. Average monthly job gains in local government thus far in 2001 have been considerably larger than in 2000.

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls was unchanged in June at 34.3 hours, seasonally adjusted. The manufacturing workweek edged down by 0.1 hour to 40.7 hours. Manufac- turing overtime was up by 0.1 hour to 4.0 hours. Over the past 12 months, the factory workweek has fallen by 1.0 hour and factory overtime by 0.6 hour. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls declined by 0.2 percent in June to 151.2 (1982=100), seasonally adjusted. The manufacturing index fell by 1.0 percent to 98.2. The manufacturing index has fallen by 7.9 percent over the past 12 months and is now at its lowest level since March 1983. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

Average hourly earnings of production or nonsupervisory workers on private nonfarm payrolls increased by 4 cents in June to $14.29, seasonally adjusted. Over the month, average weekly earnings increased by 0.3 percent to $490.15. Over the year, average hourly earnings rose by 4.2 percent and average weekly earnings grew by 3.6 percent. (See table B-3.)

Expansion of the Current Population Survey (Household Survey) Sample

Beginning in September 2000, the Census Bureau expanded the monthly sample for the Current Population Survey (CPS) to meet the requirements of the State Children's Health Insurance Program (SCHIP) legislation. This legislation requires that the Census Bureau improve state estimates of the number of children who live in low-income families and lack health insurance. These estimates are obtained from the Annual Demographic Supplement to the CPS. The expansion of the monthly CPS sample was one part of the Census Bureau's plan for strengthening the SCHIP estimates. The monthly CPS sample was increased in 31 states and the District of Columbia, and the total number of households eligible for the survey rose from about 50,000 to about 60,000. The additional households were introduced into the survey over a 3-month period beginning in September 2000.

In the September 2000 Employment Situation news release (USDL 00-284), the Bureau of Labor Statistics (BLS) stated that it would not use the additional sample to produce the official national labor force estimates prior to the release of July 2001 data in August. This delay would allow BLS sufficient time to evaluate the differences, if any, between the estimates obtained from the current 50,000-household sample and the expanded 60,000-household sample. BLS evaluated the monthly data for the November 2000-April 2001 period and found no significant differences in the national labor force estimates derived from the two samples. Thus, BLS plans to incorporate the additional sample into the July 2001 official national estimates. Since estimates from the two samples were virtually identical, household data for the first 6 months of 2001 will not be revised.

The August 2001 issue of Employment and Earnings will contain an article discussing this sample expansion in more detail.