December 2008 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 declined sharply in December, and the unemployment rate rose from 6.8 to 7.2 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Payroll employment fell by 524,000 over the month and by 1.9 million over the last 4 months of 2008. In December, job losses were large and widespread across most major industry sectors.

Unemployment (Household Survey Data)

In December, the number of unemployed persons increased by 632,000 to 11.1 mil- lion and the unemployment rate rose to 7.2 percent. Since the start of the reces- sion in December 2007, the number of unemployed persons has grown by 3.6 million, and the unemployment rate has risen by 2.3 percentage points. (See table A-1.)

The unemployment rates for adult men (7.2 percent), adult women (5.9 percent), and whites (6.6 percent) increased in December. The jobless rates for teenagers (20.8 percent), blacks (11.9 percent), and Hispanics (9.2 percent) were little changed over the month. The unemployment rate for Asians was 5.1 percent in Decem- ber, not seasonally adjusted. (See tables A-1, A-2, and A-3.)

Among the unemployed, the number of job losers and persons who completed tempo- rary jobs rose by 315,000 to 6.5 million in December. Over the past 12 months, the size of this group has increased by 2.7 million. (See table A-8.) The number of long-term unemployed (those jobless for 27 weeks or more) rose to 2.6 million in December and was up by 1.3 million in 2008. (See table A-9.)

Total Employment and the Labor Force (Household Survey Data)

The civilian labor force (154.4 million) and the labor force participation rate (65.7 percent) were little changed in December. The employment-population ratio fell by 0.4 percentage point to 61.0 percent over the month and by 1.7 percentage points in 2008. (See table A-1.)

In December, the number of persons who worked part time for economic reasons (some- times referred to as involuntary part-time workers) continued to increase, reaching 8.0 million. The number of such workers rose by 3.4 million over the past 12 months. This category includes persons who would like to work full time but were working part time because their hours had been cut back or because they were unable to find full- time jobs. (See table A-5.)

Persons Not in the Labor Force (Household Survey Data)

About 1.9 million persons (not seasonally adjusted) were marginally attached to the labor force in December, 564,000 more than 12 months 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 642,000 discouraged work- ers in December, up by 279,000 from a year earlier. Discouraged workers are persons not currently looking for work specifically because they believe no jobs are available for them. The other 1.3 million persons marginally attached to the labor force in December 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.)

Industry Payroll Employment (Establishment Survey Data)

Total nonfarm payroll employment declined sharply (-524,000) in December. Over the past 4 months, payroll employment has fallen by 1.9 million, or 1.4 percent. In Decem- ber, large job losses continued in manufacturing, construction, and employment services, while health care continued to add jobs. (See table B-1.)

Manufacturing employment fell by 149,000 in December, the largest over-the-month de- cline since August 2001. Factory job losses totaled 791,000 in 2008, with nearly half of the decrease occurring in the fourth quarter. In December, declines were widespread among the component industries. The largest job losses occurred in fabricated metal products (-28,000) and motor vehicles and parts (-21,000).

Employment in construction continued to decline (-101,000) in December and has fallen by 899,000 since peaking in September 2006. Over the month, job losses occurred through- out the industry.

Within professional and business services, the temporary help industry lost 81,000 jobs in December, bringing job losses in 2008 to 490,000. In December, employment also fell in the management of companies and enterprises (-8,000) and in architectural and engineering services (-7,000).

Employment in retail trade declined by 67,000 in December and by 522,000 for all of 2008. More than half of the losses in 2008 occurred in the last 4 months of the year. In December, employment decreased in automobile dealerships (-22,000), furniture and home furnishing stores (-8,000), and electronics and appliance stores (-5,000). Whole- sale trade employment fell by 30,000 over the month and by 164,000 in 2008.

Elsewhere in the service-providing sector, employment in transportation and ware- housing declined by 24,000 in December, with losses in truck transportation (-16,000) and air transportation (-4,000). The information industry lost 20,000 jobs over the month. Food services employment continued to trend downward (-20,000) and has de- creased by 104,000 since its recent peak in June 2008. Employment in financial activities edged down in December and fell by 148,000 in 2008.

Health care employment continued to grow in December (32,000), with over-the-month job gains in ambulatory services (14,000) and hospitals (12,000). In 2008, health care added 372,000 jobs.

The change in total nonfarm employment for October was revised from -320,000 to -423,000, and the change for November was revised from -533,000 to -584,000. Monthly revisions result from additional sample reports and the monthly recalculation of sea- sonal factors.

Weekly Hours (Establishment Survey Data)

In December, the average workweek for production and nonsupervisory workers on pri- vate nonfarm payrolls fell by 0.2 hour to 33.3 hours, seasonally adjusted--the lowest level on record for the series, which began in 1964. The manufacturing workweek, at 39.9 hours, declined by 0.4 hour over the month, and factory overtime, at 3.0 hours, declined by 0.3 hour. (See table B-2.)

The index of aggregate weekly hours of production and nonsupervisory workers on private nonfarm payrolls fell by 1.1 percent in December and 4.0 percent since peaking in December 2007. The manufacturing index declined by 2.4 percent over the month. (See table B-5.)

Hourly and Weekly Earnings (Establishment Survey Data)

In December, average hourly earnings of production and nonsupervisory workers on private nonfarm payrolls rose by 5 cents, or 0.3 percent, seasonally adjusted. This followed gains of 8 cents in November and 6 cents in October. For all of 2008, average hourly earnings increased by 3.7 percent and average weekly earnings rose by 2.2 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. As a result of this process, seasonally adjusted data for January 2004-November 2008 were subject to revision.

An article describing the seasonal adjustment methodology for the household survey data and revised data for January 2008-November 2008 is available at http://www.bls.gov/cps/cpsrs2009.pdf.

Historical data for the household series contained in the A tables of this release can be accessed at http://www.bls.gov/cps/cpsatabs.htm. Revised historical seasonally adjusted monthly and quarterly data for additional series are available on the Internet at ftp://ftp.bls.gov/ pub/special.requests/lf/.

HOUSEHOLD DATA HOUSEHOLD DATA

2007 2008 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: Seasonally adjusted data have been revised to reflect updated seasonal adjustment factors.