December 2003 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.

Employment was virtually unchanged in December while the unemployment rate, at 5.7 percent, continued to trend down, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Following increases that totaled 277,000 in the prior 4 months, nonfarm payroll was flat in December (+1,000).

Unemployment (Household Survey Data)

The number of unemployed persons was 8.4 million in December and the unem- ployment rate was 5.7 percent. Both measures continued to edge down from their recent highs in June 2003. In December, the unemployment rates for adult men (5.3 percent) and Hispanics or Latinos (6.6 percent) declined. The jobless rates for the other major worker groups--adult women (5.1 percent), teenagers (16.1 percent), whites (5.0 percent), and blacks (10.3 percent)--showed little or no change from the previous month. The unemployment rate for Asians was 5.3 percent in December, not seasonally adjusted. (See tables A-1, A-2, and A-3.)

Total Employment and the Labor Force (Household Survey Data)

The civilian labor force fell by 309,000 in December to 146.9 million; the labor force participation rate decreased over the month to 66.0 percent. Over the year, the participation rate declined by 0.4 percentage point. Both total employment (138.5 million) and the employment-population ratio (62.2 percent) were about unchanged in December. (See table A-1.)

Persons Not in the Labor Force (Household Survey Data)

In December, about 1.5 million persons were marginally attached to the labor force, about the same as a year earlier. (Data are not seasonally adjusted.) These individuals wanted and were available to work and had looked for a job sometime in the prior 12 months. They were not counted as unemployed, how- ever, because they did not actively search for work in the 4 weeks preceding the survey. There were 433,000 discouraged workers in December, also about the same as in December 2002. Discouraged workers, a subset of the marginally attached, were not currently looking for work specifically because they believed no jobs were available for them. The other 1.1 million marginally attached had not searched for work for other reasons such as school or family responsibilities. (See table A-13.)

Industry Payroll Employment (Establishment Survey Data)

Total nonfarm payroll employment was unchanged (+1,000) in December, at 130.1 million, seasonally adjusted. Employment continued to rise in the temporary help, construction, and health care industries. Retail trade and manufacturing lost jobs over the month. (See table B-1.)

In December, employment in retail trade declined by 38,000. Weak hiring for the holiday shopping period resulted in seasonally adjusted job losses in general merchandise stores; miscellaneous store retailers; and sporting goods, hobby, book, and music stores. Employment in gasoline stations also decreased over the month.

Manufacturing employment was down by 26,000 in December. From September to December, employment in this industry declined at a slower pace than during the first 8 months of 2003. Employment in nondurable goods manufacturing decreased by 18,000 in December, with the largest losses in printing and related support activities (-4,000) and in textile mills (-3,000). Manufacturing lost 516,000 jobs in 2003 and has shed 2.8 million jobs since July 2000, the last month it recorded a gain.

Within the financial activities industry, employment in credit intermedi- ation declined for the third consecutive month, reflecting the reduced volume of mortgage refinancing. From July 2000 through September 2003, the industry added 251,000 jobs, but since then employment has fallen by 39,000.

Professional and business services added 45,000 jobs in December. Over the year, employment increases in this industry have totaled 252,000. The majority of this gain occurred in temporary help services, which added 166,000 jobs in 2003, including 30,000 in December. Employment in education and health services also continued to rise over the month. Over the year, the industry added 301,000 jobs.

Construction employment continued on a modest upward trend in December. The industry has added 173,000 jobs since February.

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 33.7 hours, seasonally adjusted. The manufacturing workweek declined by 0.1 hour to 40.7 hours, and manufacturing overtime edged up by 0.1 hour to 4.6 hours. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls fell by 0.6 percent to 98.8 in December (2002=100). The manufacturing index decreased by 0.4 percent over the month to 94.6. (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 3 cents over the month to $15.50, seasonally adjusted. Average weekly earnings fell by 0.4 percent in December to $522.35. Over the year, average hourly earnings increased by 2.0 percent, and average weekly earnings rose by 1.7 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 (CPS), or household survey, to incorporate the data for that year. This year, seasonally adjusted data for January 1999-December 2003 were subject to revision. (Seasonally adjusted establishment data will be revised next month, concurrent with the introduction of annual benchmark adjustments.)

Beginning with this release, BLS has converted to the use of concurrent seasonal adjustment to produce seasonally adjusted labor force estimates from the CPS. Concurrent seasonal adjustment uses all available monthly estimates, including those for the most current month, in developing seasonal factors. This is a change from the previous practice of projecting seasonal factors for the CPS data twice a year. Due to this change in methodology, BLS will no longer publish seasonal factors for the CPS estimates. Historical seasonally adjusted household survey data will continue to be revised only at the end of each calendar year. BLS introduced the use of concurrent seasonal adjustment for the establishment survey data from the Current Employment Statistics program in June 2003 with the release of data for May 2003.

The January 2004 issue of Employment and Earnings will contain an article describing the current seasonal adjustment methodology for the household survey data and revised data for the most recent months or quarters for all regularly published tables containing seasonally adjusted household survey data. A copy of the article is available at http://www.bls.gov/cps/cpsrs2004.pdf on the Internet. Historical data for the household series contained in the "A" tables of this release also can be accessed at http://www.bls.gov/cps/cpsatabs.htm on the BLS Internet site. Revised historical seasonally adjusted monthly and quarterly data also are available on the Internet at ftp://ftp.bls.gov/pub/special.requests/lf/.

1/ Not published.

HOUSEHOLD DATA HOUSEHOLD DATA

2002 2003 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: Data have been revised to reflect updated seasonal adjustment factors.