August 2006 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.

Total nonfarm payroll employment increased by 128,000 in August, and the unemployment rate was little changed at 4.7 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Payroll employ- ment grew notably over the month in education and health services; several other industries had modest increases. Average hourly earnings rose by 2 cents, or 0.1 percent, in August following larger gains in the prior 2 months.

Unemployment (Household Survey Data)

The number of unemployed persons (7.1 million) and the unemployment rate (4.7 percent) were essentially unchanged in August. A year earlier, the number of un- employed persons was 7.4 million, and the jobless rate was 4.9 percent.

Over the month, the unemployment rates for most major worker groups--adult men (4.1 percent), adult women (4.1 percent), teenagers (16.2 percent), whites (4.1 per- cent), and Hispanics (5.3 percent)--showed little or no change. The jobless rate for blacks declined to 8.8 percent in August. The unemployment rate for Asians was 2.9 percent, not seasonally adjusted. (See tables A-1, A-2, and A-3.)

Total Employment and the Labor Force (Household Survey Data)

Both total employment (144.6 million) and the employment-population ratio (63.1 percent) were essentially unchanged in August. The labor force partici- pation rate held at 66.2 percent. (See table A-1.)

Persons Not in the Labor Force (Household Survey Data)

About 1.6 million persons (not seasonally adjusted) were marginally attached to the labor force in August, the same as a year earlier. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. Among the marginally attached, there were 448,000 discouraged workers in August, up slightly from a year earlier. Discouraged workers were not currently looking for work specifi- cally because they believed no jobs were available for them. The other 1.1 mil- lion marginally attached had not searched for work for reasons such as school at- tendance or family responsibilities. (See table A-13.)

(Numbers in thousands, not seasonally adjusted)

1 Represents persons in the civilian noninstitutional population age 16 and over who resided in households that were eligible to be selected for the Current Population Survey (CPS). These data are not representative of the total evacuee population because they do not in- clude children or people residing in shelters, hotels, places of worship, or other units outside the scope of the CPS. The total number of evac- uees estimated from the CPS may change from month to month as people move in and out of the scope of the survey and because of sampling and nonsampling error. NOTE: These data use population controls that have been adjusted to account for interstate moves by evacuees.

Employment Status of Hurricane Katrina Evacuees (Household Survey Data)

Beginning in October 2005, questions were added to the household survey to identify persons who evacuated from their homes, even temporarily, due to Hurricane Katrina. Data collected through these questions do not account for all evacuees; persons living outside the scope of the survey--such as those living in hotels or shelters--are not included. The questions were asked of persons in the household survey sample throughout the country, since some evacuees relocated far from the storm-affected areas. An additional question determined whether evacuees had returned to their homes and were residing there at the time of the August 2006 survey. The total number of evacuees estimated from the household survey may change from month to month as people move in and out of the scope of the survey; also, because the estimates are obtained from a sample survey, they may vary from month to month due to sampling and nonsampling error.

Information gathered in August represented 1.2 million persons age 16 and over who had evacuated from where they were living in August 2005 due to Hurricane Katrina. These evacuees either had moved back to their homes or were living in other residential units covered in the survey. About 6 in 10 of the evacuees were living in their August 2005 residences. Of all evacuees identified, 63.0 percent were in the labor force in August 2006. The unemployment rate for persons identified as evacuees was 12.6 percent. The rate was much higher for evacuees who were not living in their former homes (22.2 per- cent) than for those who were again living in their pre-Katrina residences (4.8 percent). (See table B.)

Industry Payroll Employment (Establishment Survey Data)

Total nonfarm payroll employment rose by 128,000 in August to 135.5 million. This increase was roughly in line with the average monthly gain for the 4-month period from April to July (+117,000). Job growth averaged 169,000 a month for the year ending in March. (See table B-1.)

In August, education and health services continued to add jobs with a gain of 60,000. Within the industry, health care employment rose by 35,000. Hospitals added 14,000 jobs, and employment also increased in doctors’ offices, home health care, and outpatient care centers. Employment in social assistance grew by 13,000 over the month; about half of the increase occurred in child day care services.

Employment in food services and drinking places continued to trend up in August (+16,000). Over the year, food services has added 217,000 jobs. Employment in financial activities edged up in August. Job growth in the sector has slowed in recent months. Professional and business services employment continued to trend up in August (+26,000), but at a slower pace than in the prior 3 months, when job gains averaged 52,000. Employment in temporary help services has changed little thus far this year.

Over the month, employment in wholesale trade was little changed. Within retail trade, job losses occurred in department stores (-9,000) and gasoline stations (-5,000). Since its most recent peak in August 2005, employment in retail trade has declined by 101,000. Department stores accounted for half of the decline.

In the goods-producing sector, mining added 5,000 jobs in August, with gains in oil and gas extraction and in related support activities. Mining has expanded by 126,000 jobs, or 25 percent, since its most recent low in April 2003. Con- struction employment edged up in August following 5 months of little change.

Within manufacturing, job losses in motor vehicles and parts (-7,000), wood products (-5,000), furniture and related products (-4,000), and paper and paper products (-3,000) more than offset small gains elsewhere. Since June 2006, manufacturing employment has declined by 34,000.

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls decreased by 0.1 hour to 33.8 hours in August, seasonally adjusted. The manufacturing workweek also fell by 0.1 hour to 41.3 hours, while factory overtime was unchanged at 4.5 hours. (See table B-2.)

The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls decreased by 0.2 percent in August to 105.0 (2002=100). The manufacturing index fell by 0.3 percent to 96.7. (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 2 cents, or 0.1 percent, in August to $16.79, seasonally adjusted. This followed increases of 8 cents (0.5 percent) in July and 7 cents (0.4 percent) in June. Average weekly earnings decreased by 0.2 percent in August to $567.50. Over the year, average hourly earnings increased by 3.9 percent and average weekly earnings increased by 4.2 percent. (See table B-3.)