October 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.

Employment increased in October, and the unemployment rate declined to 4.4 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Nonfarm payroll employment grew by 92,000 in October follow- ing gains of 148,000 in September and 230,000 in August (as revised). In October, job growth continued in several service-providing industries, while employment declined in manufacturing and construction. Average hourly earn- ings rose by 6 cents over the month.

Unemployment (Household Survey Data)

The number of unemployed persons (6.7 million) edged down in October, and the unemployment rate declined to 4.4 percent. A year earlier, the number of unemployed persons was 7.4 million and the jobless rate was 4.9 percent.

Unemployment rates for most major worker groups--adult men (3.8 percent), teenagers (15.4 percent), whites (3.9 percent), and blacks (8.6 percent)-- showed little or no change over the month. The jobless rates for adult women (3.9 percent) and Hispanics (4.7 percent) fell in October. The unemployment rate for Asians was 2.7 percent, not seasonally adjusted. (See tables A-1, A-2, and A-3.)

The number of persons unemployed for 27 weeks or longer fell by 189,000 to 1.1 million in October. This group accounted for 16.0 percent of total unemployment, down from 18.2 percent in September. (See table A-9.)

Total Employment and the Labor Force (Household Survey Data)

In October, total employment increased by 437,000 to 145.3 million, and the employment-population ratio edged up to 63.3 percent. The civilian labor force, at 152.0 million, was about unchanged in October; the labor force participation rate has held at 66.2 percent since June. (See table A-1.)

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 October, about unchanged from a year earlier. These in- dividuals 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 331,000 discouraged workers in October, down 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 in the 4 weeks preceding the survey for reasons such as school attendance 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 October 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. October 2006 was the final month that the special questions relating to Hurricane Katrina were asked of survey respondents. (See box note on page 5.)

Information gathered in October represented 1.1 million persons age 16 years 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, 62.8 percent were in the labor force in October 2006. The unemployment rate for persons identified as evacuees was 11.0 percent. The rate was much higher for evacuees who were not living in their former homes (17.9 percent) than for those who were again living in their pre-Katrina residences (7.0 percent). (See table B.)

Industry Payroll Employment (Establishment Survey Data)

Total nonfarm payroll employment increased by 92,000 in October to 135.8 million. This followed job gains of 148,000 in September and 230,000 in August (as revised). Over the month, employment rose in professional and business ser- vices, health care, food services, and mining; manufacturing and construction lost jobs. (See table B-1.)

Professional and business services employment grew by 43,000 in October, with gains in management and technical consulting services (+12,000) and in business support services (+6,000). Employment in temporary help services was little changed over the month and has been relatively flat since January.

Health care employment continued to grow with a gain of 23,000 in October. Job growth occurred in nursing and residential care facilities and in hospi- tals. Over the year, health care employment has increased by 302,000. In leisure and hospitality, food services and drinking places continued to add jobs in October (+27,000).

Both wholesale and retail trade employment were little changed in October. Since January, wholesale trade has added 61,000 jobs; in contrast, retail trade employment is down by 104,000. Within retail trade, general merchandise stores lost 11,000 jobs in October. Since its most recent peak in August 2005, employ- ment in general merchandise stores has fallen by 100,000. Within financial activities, commercial banks added 5,000 jobs in October.

In the goods-producing sector, mining employment grew by 5,000 in October. Over the last 12 months, mining has added 54,000 jobs. Construction lost 26,000 jobs in October as employment declines in residential specialty trade contractors (-31,000) more than offset gains in nonresidential specialty trades. Since its most recent peak in February, employment in residential specialty trades has declined by 99,000.

Manufacturing lost 39,000 jobs in October. Plastics and rubber products lost 14,000 jobs, largely reflecting strike activity in rubber products manufacturing. Employment also declined in motor vehicles and parts (-15,000) and in wood products (-5,000).

Weekly Hours (Establishment Survey Data)

The average workweek for production or nonsupervisory workers on private nonfarm payrolls increased by 0.1 hour to 33.9 hours in October, seasonally adjusted. The manufacturing workweek also rose by 0.1 hour to 41.2 hours, and factory overtime was unchanged at 4.3 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 in October to 105.5 (2002=100). The manufacturing index was unchanged at 96.1. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

Average hourly earnings of production or nonsupervisory workers on private non- farm payrolls rose by 6 cents, or 0.4 percent, in October to $16.91, seasonally ad- justed. Average weekly earnings rose by 0.7 percent in October to $573.25. Over the year, average hourly earnings increased by 3.9 percent and average weekly earn- ings increased by 4.2 percent. (See table B-3.)