September 2002 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.

Both nonfarm payroll employment and the unemployment rate were essentially unchanged in September, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Job losses in manufacturing and transportation offset gains in finance and health services.

Unemployment (Household Survey Data)

The number of unemployed persons (8.1 million) and the unemployment rate (5.6 percent) were essentially unchanged in September. The jobless rates for the major worker groups--adult men (5.2 percent), adult women (4.9 percent), teenagers (15.7 percent), whites (5.1 percent), blacks (9.6 percent), and Hispanics (7.4 percent)--showed no statistically signi- ficant change in September. (See tables A-1 and A-2.)

Total Employment and the Labor Force (Household Survey Data)

Total employment, as measured by the household survey, rose by 711,000 to 135.2 million in September, after seasonal adjustment. Nearly half of this increase was among teens, who experience large seasonal swings in employment between August and September. The total employment-population ratio was up by 0.2 percentage point to 63.0 percent. This ratio was 0.6 percentage point lower than in September 2001 and 1.8 percentage points lower than its peak in April 2000. (See table A-1.)

The civilian labor force increased by 661,000 over the month to 143.3 million, seasonally adjusted, and the labor force participation rate rose by 0.2 percentage point to 66.8 percent. (See table A-1.)

About 7.2 million persons (not seasonally adjusted) held more than one job in September. These multiple jobholders represented 5.4 percent of the total employed. (See table A-10.)

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 September, compared with 1.3 million a year earlier. These individuals reported that they wanted and were available for work and had looked for a job sometime in the prior 12 months. They were not counted as unemployed, however, because they had not actively searched for work in the 4 weeks preceding the survey.

The number of discouraged workers was 387,000 in September, up from 280,000 a year earlier. 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)

Total nonfarm payroll employment was essentially unchanged (-43,000) in September at 130.9 million. In the prior 4 months, employment had increased by 217,000, including a gain of 107,000 (as revised) in August. (See table B-1.)

Manufacturing employment decreased by 35,000 in September. Job losses have accelerated over the last 2 months, following a moderation in declines between March and July. This trend is especially evident in electronic equipment and industrial machinery, which lost 11,000 and 9,000 jobs in September, respectively. Aircraft and parts and furniture and fixtures lost 6,000 jobs each in September. Aircraft manufacturers have reduced payrolls by 65,000 workers over the year, primarily due to reduced demand for passenger jets.

Transportation employment fell by 26,000 in September. Despite a 12,000 job loss over the month, air transportation has had no net employment change so far this year. This follows losses that totaled 132,000 in the last 4 months of 2001. Employment in the trucking indus- try had held steady for the first 7 months of this year, but since July has fallen by 22,000. Employment in communications continued to decline in September; since April 2001, the industry has lost 145,000 jobs.

Employment in the services industry was little changed in September (+28,000), following a gain of 137,000 in August. Health services added 21,000 jobs in September; employment in the industry has risen by 282,000 over the past 12 months. Employment in engineering and management services increased by 18,000 in September. Amusement and recreation services lost 26,000 jobs, as seasonal layoffs were larger than usual.

Finance employment grew by 9,000 over the month, with most of the gain occurring among mortgage bankers (+6,000). Over the past year, mortgage banking has added 44,000 jobs. Federal government employment (excluding postal workers) was up in September, mainly due to the hiring of additional airport security workers.

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls increased by 0.2 hour in September to 34.3 hours, seasonally adjusted. This follows a rise of 0.1 hour in August. These gains offset July's 0.3 hour loss. The manufacturing workweek was unchanged at 40.9 hours. Manufacturing overtime edged down by 0.1 hour to 4.1 hours. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls rose by 0.4 percent in September to 148.6 (1982=100). The manufacturing index was down by 0.3 percent over the month to 92.1. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

Average hourly earnings of production or nonsupervisory workers on pri- vate nonfarm payrolls increased by 5 cents in September to $14.87, seasonally adjusted. Average weekly earnings rose by 0.9 percent over the month to $510.04. Over the year, average hourly earnings grew by 3.0 percent, and average weekly earnings increased by 3.7 percent. (See table B-3.)

Upcoming Changes to Household and National Nonfarm Payroll Data Series

Household Data Series

Effective with the release of November 2002 data, the Current Popula- tion Survey (CPS) sample size will be decreased from about 60,000 to about 55,000 eligible households as a cost savings measure. The sample cut will occur in 31 states and the District of Columbia and will reduce by about half the number of households added to the CPS sample in the fall of 2000. This decrease in the sample will have a negligible effect on the reliability of national labor force estimates.

Effective with the release of January 2003 data, several changes to the CPS will affect estimates contained in the Employment Situation news release:

--Population controls that reflect the results of Census 2000 will be used in the monthly CPS estimation process. In addition, CPS data series from January 2000 through December 2002 will be revised to reflect the introduction of the Census 2000-based population controls.

--The questions on race and Hispanic origin in the CPS will be modified to comply with the new standards for federal statistical agencies. A major change under those standards is that respondents may select more than one race when answering the survey. Respondents will continue to be asked a separate question to determine if they are Hispanic. The Employment Situation news release will present data for persons who report they are white and no other race, black or African American and no other race, and Asian and no other race. Data will continue to be presented for Hispanics separately.

--The CPS will adopt the Census industry and occupation classification systems derived from the 2002 North American Industry Classification System and the 2000 Standard Occupational Classification system. These new classification systems represent complete breaks in the time series for occupation and industry data. As a result, seasonally adjusted oc- cupation and industry estimates from the household survey will not be presented until sufficient time series become available for seasonal ad- justment.

--The CPS program will begin using the X-12 ARIMA software for seasonal adjustment of time series data. Because of the other revisions being introduced with the January data, the annual revision of 5 years of seasonally adjusted data that typically occurs with the release of data for December will be delayed until the release of data for January.

Questions about upcoming changes to the CPS data series can be directed to the Division of Labor Force Statistics at 202-691-6378.

National Nonfarm Payroll Data Series

NAICS conversion. The nonfarm payroll series, produced from the Current Employment Statistics (CES) program, will be converted from the 1987 Standard Industrial Classification (SIC) basis to the 2002 North American Industry Classification System (NAICS) basis with the June 6, 2003, release of May 2003 estimates. The NAICS conversion involves major definitional changes to many of the currently published SIC-based series. After the conversion to NAICS, SIC-based series will no longer be produced or published. Historical time series will be reconstructed as part of the NAICS conversion process. All published series will have a NAICS-based history extending back to at least January 1990. For total nonfarm and other high-level aggregates, NAICS history will begin in January 1939, the current starting date for these series. For more detailed series, the starting date will vary depending on the scope of the definitional changes between SIC and NAICS. The NAICS-based reconstruction effort will cover all CES published data types: all employees, women workers, production workers, average weekly hours, average hourly earnings, and derivative series (for example, indexes of aggregate weekly hours).

Completion of the CES sample redesign. June 6, 2003, also will mark the completion of the CES sample redesign phase-in. The redesign converts the CES from a quota-based sample to a probability-based sample. In June 2003, the services industries will be converted to the new sample design; all other private sector industries have already been converted. The final stage of sample redesign phase-in may result in level shifts for average weekly hours, average hourly earnings, production worker, and women worker series. New levels for these series are being recomputed from the NAICS- based probability sample.

Concurrent seasonal adjustment. Also beginning in June 2003, the CES program will convert to concurrent seasonal adjustment, which uses all available monthly estimates, including those for the current month, in developing seasonal factors. Currently, the CES program projects seasonal factors twice a year. With the introduction of concurrent seasonal adjust- ment, BLS will no longer publish seasonal factors for CES national estimates.

Change to federal government series. Beginning in June 2003, the CES series for federal government employment will be revised slightly in scope and definition due to a change in source data and estimation methods. The current national series is an end-of-month federal employee count produced by the Office of Personnel Management, and it excludes some workers, mostly employees who work in Department of Defense-owned establishments such as military base commissaries. The CES national series will include these workers. Also, federal government employment will be estimated from a sample of federal establishments, will be benchmarked annually to counts from unemployment insurance tax records, and will reflect employee counts as of the pay period including the 12th of the month, consistent with other CES industry series. The historical time series for federal government employment will be revised to reflect these changes.

Further information on upcoming changes to CES data series is available through the BLS public database on the Internet, via the CES homepage at http://www.bls.gov/ces/, or by calling 202-691-6555.