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THE EMPLOYMENT SITUATION: MARCH 2008

HEARING

BEFORE THE

JOINT ECONOMIC COMMITTEE 

CONGRESS OF THE UNITED STATES

ONE HUNDRED TENTH CONGRESS

SECOND SESSION

April 4, 2008

Printed for the use of the Joint Economic Committee

(

(II)

JOINT ECONOMIC COMMITTEE

[Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress]

SENATE 

CHARLES E. SCHUMER, New York, Chairman 

EDWARD M. KENNEDY, Massachusetts 

JEFF BINGAMAN, New Mexico 

AMY KLOBUCHAR, Minnesota 

ROBERT P. CASEY, JR., Pennsylvania 

JIM WEBB, Virginia 

SAM BROWNBACK, Kansas 

JOHN E. SUNUNU, New Hampshire 

JIM DEMINT, South Carolina 

ROBERT F. BENNETT, Utah 

HOUSE OF REPRESENTATIVES 

CAROLYN B. MALONEY, New York, Vice Chair 

MAURICE D. HINCHEY, New York 

BARON P. HILL, Indiana 

LORETTA SANCHEZ, California 

ELIJAH E. CUMMINGS, Maryland 

LLOYD DOGGETT, Texas 

JIM SAXTON, New Jersey, Ranking Republican 

KEVIN BRADY, Texas 

PHIL ENGLISH, Pennsylvania 

RON PAUL, Texas

MICHAEL LASKAWY, Executive Director 

CHRISTOPHER J. FRENZE, Republican Staff Director 

(III)

C O N T E N T S 

OPENING STATEMENT OF MEMBERS

Statement of Hon. Charles E. Schumer, Chairman, a U.S. Senator from 

New York .............................................................................................................. 1

Statement of Hon. Baron P. Hill, a U.S. Representative from Indiana .............. 2

Statement of Hon. Sam Brownback, a U.S. Senator from Kansas ...................... 5

WITNESS

Statement of Dr. Keith Hall, Commissioner, Bureau of Labor Statistics, Accompanied by: Philip L. Rones, Deputy Commissioner, Bureau of Labor 

Statistics, U.S. Department of Labor, Washington, D.C.; and Michael W. 

Horrigan, Associate Commissioner for Prices and Living Conditions ............. 3

SUBMISSIONS FOR THE RECORD

Prepared statement of Senator Charles E. Schumer ............................................ 17

Prepared statement of Representative Baron P. Hill ........................................... 18

Prepared statement of Keith Hall, Commissioner, Bureau of Labor Statistics . 18

Prepared statement of Senator Sam Brownback .................................................. 19

(1)

THE EMPLOYMENT SITUATION:

MARCH 2008

FRIDAY, APRIL 4, 2008

CONGRESS OF THE UNITED STATES, 

JOINT ECONOMIC COMMITTEE, 

Washington, DC 

The committee met at 9:30 a.m., in room 106 of the Dirksen Senate Office Building, the Honorable Charles E. Schumer (Chairman) 

and Congressman Baron Hill, presiding. 

Senators present: Schumer and Brownback. 

Representatives present: Hill. 

Staff present: Christina Baumgardner, Heather Boushey, 

Stephanie Dreyer, Nan Gibson, Greeta Goodwin, Colleen Healy, 

Annabelle Tamerjan, Chris Frenze, Bob Keleher, Jeff 

Schlagenhauf, and Jeff Wrase. 

OPENING STATEMENT OF HON. CHARLES E. SCHUMER, 

CHAIRMAN, A U.S. SENATOR FROM NEW YORK 

Senator Schumer. The hearing will come to order. I want to 

thank Commissioner Hall and his staff for being here. 

Well today we got some bad news on the job front. The numbers 

80,000 and 60,000 should be a shot across the bow to this Administration to get off its hands and start moving in terms of getting us 

out of the bad straits we are in in this economy. 

These numbers are a shot across the bow. They are saying that 

the economy is getting soft. It is no longer just housing prices and 

credit, but jobs. And once you get the three together headed downward, there is real trouble in the economy. 

Despite these job numbers, the Administration continues its Hoover-like attitude of doing nothing. We get no help on getting some 

relief in the mortgage foreclosure crisis. We get no help on restructuring our financial system in a way that meets the needs of the 

Twenty-first Century. 

We get no help on crafting a stimulus package that can get the 

economy going—a second stimulus package dealing with infrastructure and unemployment and the kind of direct spending that is 

needed to augment the tax relief that we have passed. 

And so these numbers hopefully will be a wake-up call to the Administration, a wake-up call to stop its Hoover-like trance of doing 

nothing, letting the free market govern in any way. We believe in 

free markets but we have learned over the last 100 years that 

there are ways to improve them. 

2

I want to thank Baron Hill for chairing this hearing. I apologize. 

We have votes. I did not expect to be able to be here at all and 

thank the Commissioner for his work. 

Congressman Hill. 

[The prepared statement of Senator Schumer appears in the Submissions for the Record on page 17.] 

OPENING STATEMENT OF HON. BARON P. HILL, A U.S. 

REPRESENTATIVE FROM INDIANA 

Mr. Hill [presiding]. Good morning everybody. I want to welcome 

Commissioner Hall and thank him for testifying here this morning 

on the March employment situation. 

I have a vested interest in these dreary numbers we have recognized this morning, as I have seen firsthand how the recent economic downturns have affected my constituents in Bloomington, Indiana. 

The General Electric Refrigerator Plant announced in February 

that it will close by the end of 2009, and it will result in the loss 

of 900 jobs for this area. 

Job losses like this are occurring throughout the country as today’s employment numbers highlight. The labor market news keeps 

getting worse, and today’s report is no exception. 

As a matter of fact, yesterday we were anticipating the loss of 

60,000 jobs—some were estimating 50,000 jobs—and today we 

learned that it is 80,000 jobs. 

March marks the third consecutive month of job losses for a total 

of 232,000 jobs lost in the first quarter of this year. We have not 

seen job losses like this for nearly 5 years. 

Now this chart over here illustrates what is going on right now. 

The downward arrow indicates the loss of jobs in non-farm payrolls, and it is alarming. And it keeps on going down. 

I agree with Senator Schumer that this Administration needs to 

get serious about trying to get this economy turned around. 

On Wednesday, the Federal Reserve Chairman Ben Bernanke 

told this Committee that a recession is possible. We do not want 

that to happen. Maybe we are already in that, and so I think it is 

behooving to all of us that we as Members of Congress, along with 

the Administration, try to do something to prevent this from happening. 

Yesterday brought news that the weekly unemployment benefit 

claims rose above 400,000, a level that typically signals that the 

labor market is already in recession. 

The Federal Reserve and many private sector economists expect 

unemployment to climb throughout the year. We seem to be a long 

way from a healthy economy which usually adds 150,000 to 

200,000 jobs each month, but the economy has lost 77,000 jobs per 

month on the average in the first quarter of this year. 

The widespread job losses we are seeing are a clear indication to 

me that the economy is in trouble. For nearly 2 years now the 

manufacturing industry has shrunk. These trends adversely affect 

my State’s economy as Indiana has a high proportion of manufacturing jobs compared to the rest of the country. 

In Indiana we have seen an average unemployment period of 9 

weeks. And as of the fourth quarter of 2007, 40 percent of unemVerDate 0ct 09 2002 09:13 Dec 11, 2008 Jkt 045038 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 C:\DOCS\42946.TXT CELINA PsN: BACKUP
3

ployed Hoosiers have now exhausted their unemployment benefits, 

the eleventh highest in the nation. 

Congress should consider a proposal to provide an extension of 

unemployment benefits that would last an additional 13 weeks. 

Republicans in Congress and this Administration have resisted 

that. Workers could receive these benefits—workers who could receive these benefits are those who have lost their job through no 

fault of their own. They have had the bad luck of working for a 

business that must lay off workers or close its doors due to the 

weakening economy, like the workers at the Bloomington General 

Electric plant. 

Extending unemployment benefits to struggling workers should 

be a high priority. Wages are not keeping up with the rising cost 

of living. Sky high gas prices and rising health-care costs add to 

the pinch for families. 

These elements have combined to create the lowest consumer 

outlook for the economy in 35 years. And on another chart here we 

can see that since October real earnings in this country are dropping dramatically at an alarming rate. 

As I said earlier, this economy is in trouble and we better be 

doing something about it. I do want to thank Mr. Hall and his colleagues for being here to discuss today’s labor statistics, and I look 

forward to the continued focus on labor market conditions by this 

Committee. 

Now let me introduce our witness. Dr. Keith Hall is the Commissioner of Labor Statistics for the U.S. Department of Labor. As 

Commissioner he oversees the Bureau of Labor Statistics which is 

the principal fact-finding agency in the Federal Government in the 

broad field of labor economics and statistics. 

Prior to becoming Commissioner, Dr. Hall was the chief economist for the White House Council of Economic Advisors for 2 years. 

He has also served as the chief economist for the U.S. Department of Commerce. Before entering government, Dr. Hall was an 

economics professor on the faculties of both the University of Arkansas and the University of Missouri. 

He received his Ph.D. in economics from Purdue University, a 

good old Indiana college. I’m glad that you went there. 

I also want to acknowledge your colleagues Mr. Rones and Mr. 

Horrigan and thank them for joining us today. 

Commissioner Hall, you may proceed with your testimony. 

[The prepared statement of Representative Hill appears in the 

Submissions for the Record on page 18.] 

STATEMENT OF HON. KEITH HALL, COMMISSIONER, BUREAU 

OF LABOR STATISTICS, ACCOMPANIED BY: PHILIP L. RONES, 

DEPUTY COMMISSIONER, BUREAU OF LABOR STATISTICS, 

U.S. DEPARTMENT OF LABOR, WASHINGTON, D.C.; AND MICHAEL W. HORRIGAN, ASSOCIATE COMMISSIONER FOR 

PRICES AND LIVING CONDITIONS 

Mr. Hall. I thank you, Mr. Chairman. Thank you for this opportunity to discuss the March labor market data we released this 

morning. 

Non-farm payroll employment continued to trend down in March 

and the unemployment rate rose from 4.8 to 5.1 percent. 

4

Payroll employment edged down by 80,000 over the month bringing the decline over the past 3 months to 232,000. To put these recent changes into context I would note that labor market conditions 

started to weaken more than a year ago. 

Average monthly job growth slowed from 175,000 in 2006 to 

107,000 in the first half of last year, to 76,000 in the last half of 

last year to –77,000 for the first quarter of this year. 

The unemployment rate remained at or near 4.5 percent during 

the first half of 2007 but rose steadily to 4.7 percent in the third 

quarter, 4.8 percent in the fourth quarter, and an average of 4.9 

percent in the first quarter of this year. 

Returning to the payroll employment figures for March, job 

losses occurred in construction, manufacturing, and employment 

services. Job growth continued in health care, food services, and 

mining. 

The construction industry lost 51,000 jobs over the month with 

declines concentrated in residential and nonresidential specialty 

trade contracting. Since its peak in September 2006, construction 

employment has fallen now by 394,000. 

Manufacturing employment decreased by 48,000 in March. Motor 

vehicle manufacturing employment was down by 24,000; this decline largely reflected the impact of a strike at an automotive parts 

maker. The resulting parts shortage triggered plant shutdowns and 

idled workers at non-striking motor vehicle factories. 

Elsewhere in manufacturing there were job declines in several 

construction-related industries: wood products, furniture, and nonmetallic minerals. 

Both manufacturing hours and overtime were up by one-tenth of 

an hour. 

In the service-providing sector, employment services shed 42,000 

jobs in March. This industry group includes temporary help services. Over the past 12 months, employment services has lost 

158,000 jobs, three-quarters of which were in temporary help. 

Professional technical services employment was little changed for 

the third consecutive month compared with average monthly gains 

of 27,000 last year. 

Elsewhere in the service-providing sector, employment growth 

continued in health care and in food services. Each industry added 

23,000 jobs in March. 

In the goods-producing sector, mining employment rose by 6,000 

due to gains in oil and gas extraction and related support activities. 

Average hourly earnings for production and non-supervisory workers in the private sector rose by $.05 in March and have increased 

by 3.6 percent over the past 12 months. 

From February 2007 to February 2008 the Consumer Price Index 

for urban wage earners and clerical workers rose by 4.5 percent. 

Turning to the labor market data from the survey of households, 

the number of unemployed and the unemployment rate both rose 

over the month. The jobless rate was 5.1 percent in March, up from 

4.8 percent in February and up from 4.4 percent in March of last 

year. 

Over the month the number of unemployed persons grew by 

434,000 to 7.8 million. The number of unemployed persons who 

were job losers continued to trend up. Job losers represent 54 perVerDate 0ct 09 2002 09:13 Dec 11, 2008 Jkt 045038 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\DOCS\42946.TXT CELINA PsN: BACKUP
5

cent of all unemployed persons in March, up from 48 percent 12 

months earlier. 

Other groups of unemployed persons include those entering the 

labor market for the first time, those re-entering after an absence, 

and those who voluntarily leave jobs. 

About 1.3 million unemployed individuals had been searching for 

work for 27 weeks or more, little changed from a year earlier. 

The number of persons in the labor force increased in March, reversing the decline in the prior month. The labor force participation 

rate has been at or near 66 percent since last spring. In March, 

62.6 percent of the population was employed, down from a recent 

peak of 63.4 percent at the end of 2006. 

The number of persons working part-time who prefer full-time 

employment showed little change over the month but has risen by 

629,000 over the past 12 months. 

In summary, payroll employment continued to trend down in 

March. Job losses have totaled 232,000 for the first 3 months of the 

year. The unemployment rate rose to 5.1 percent. 

My colleagues and I would now be glad to answer your questions. 

[The prepared statement of Commissioner Hall appears in the 

Submissions for the Record on page 18.] 

Mr. Hill. Thank you, Dr. Hall. 

The Chair wants to recognize Senator Brownback for an opening 

statement. 

OPENING STATEMENT OF HON. SAM BROWNBACK, A U.S. 

SENATOR FROM KANSAS 

Senator Brownback. Thank you very much, Mr. Chairman, 

and Commissioner and witnesses. I appreciate very much you 

being here. We are all very interested in hearing about recent developments in the labor force. 

Today’s news that the economy lost 80,000 payroll jobs last 

month and the unemployment rate rose 5.1 percent is disappointing to all of us. This is not good news. This is bad news. 

We will be working on what we can do to see that that not go 

further in a difficult way. I do want to get some questions to you 

as we get into a time period for questions whenever that might be 

appropriate to be able to ask what—do we see in trend lines here 

in the data that can let us know where this is going or what particular areas seem to be the weakest and where do we have the potential for strength. Those are the things I’m going to be curious 

about as well. 

Mr. Chairman, thank you for letting me step in here. We had 

two votes on the Senate floor that I had to be at and so I look forward to the rest of the presentation and some questions. 

[The prepared statement of Senator Brownback appears in the 

Submissions for the Record on page 19.] 

Mr. Hill. I don’t know if your other colleagues wish to make any 

statements or not? 

Mr. Hall. [Nods in the negative.] 

Mr. Hill. Let me ask the first question, Dr. Hall. When was the 

last time we have had three consecutive months of job losses? 

6

Mr. Hall. The last time we had three consecutive months was 

between April and June in 2003 while the U.S. Labor market was 

still recovering from the 2001 recession. 

Mr. Hill. Does 3 months of job losses mean that we’re in a recession? 

Mr. Hall. I would like to not offer an opinion on that primarily 

because of the role of the Bureau of Labor Statistics. Our mission 

is to produce relevant and accurate and objective economic statistics and objective analysis of the factors underlying the trends devoid of value judgments, assumptions, or opinions. 

So I therefore feel constrained by my position from offering an 

opinion on particularly where the economy is going to go from now. 

Mr. Hill. Let me ask it in a different way that may kind of let 

you off the hook. In discussions among yourself and other economists, what is the measurement by which most economists declare 

that we are in a recession? Do you know the answer to that question? 

Mr. Hall. There is not a really strong rule of thumb. The generally accepted group that makes a declaration of a recession is a 

committee within the National Bureau of Economic Research, 

which is a private nonprofit research organization. They usually 

make a determination of a recession. 

I can tell you first that a recession is generally defined as a decline in economic activity spreading across the economy that lasts 

for more than just a few months. 

This committee typically, as a result, makes the determination 

retrospectively. So they do it fairly far down the line. 

For example, the last two recessions they waited until eight 

straight months of job loss before they declared a recession. Other 

than that, I am not sure there are real strong rules of thumb. 

Mr. Hill. Is the labor market in a recession right now? 

Mr. Hall. The real answer to that would be if the labor market 

started to shed jobs, or continued to shed jobs for several months. 

We have had 3 months of that. We will have to wait and see where 

it goes from here. 

I am not sure for example the committee would have an opinion 

yet as to whether the labor market has been in decline for long 

enough for it to be declared a recession. 

Mr. Hill. Again, is there a defined length of time among economists who feel like that we can label this labor market in a recession? 

Mr. Hall. There really isn’t. There really isn’t. You know, at this 

point there are lots of people who have an opinion on it, and they 

are quite often right fairly early on, but I don’t know of a consensus rule of thumb on the labor market. 

Mr. Hill. But would you be willing to offer that these statistics 

that we are hearing today and for the last couple of months spell 

trouble for our economy in this country? 

Mr. Hall. It is certainly a serious concern. 

Mr. Hill. Can you tell us where the job losses began and what 

industries are now seeing employment?. 

Mr. Hall. Sure. The residential construction industry began experiencing job losses in early 2006. More broadly, industries related 

7

to the housing market have been shedding jobs for about the past 

2 years, declining by nearly 800,000 over that period. 

At the moment now the job losses are appearing broadly. In fact, 

just about every sector—there are exceptions—but just about every 

sector has had a slowdown in job growth and a number have actually had job loss at the moment. 

In particular for industries that have not had job losses, that still 

appear pretty strong, it is pretty much health care and educational 

services that remain strong. 

Mr. Hill. So we are increasing jobs in those sectors? 

Mr. Hall. Yes. 

Mr. Hill. What subsectors of the manufacturing industry have 

been hardest hit by the recent job losses? 

Mr. Hall. Very recently it has been automotive, motor vehicles. 

Other than that, I think it is fairly broad in manufacturing. Manufacturing is an industry that has not actually had job gains. In fact 

we have not had a significant increase in jobs in manufacturing for 

a decade. So that has been an industry that has had long term job 

loss. What has happened recently of course is the job loss has increased. 

Mr. Hill. Well let me ask you, you talk about the automobile sector having job losses, does that apply just to American-owned companies in the United States? Or are we talking about foreign-owned 

companies that are manufacturing in the United States as well? 

Mr. Hall. Yes. I mean our data includes all manufacturing in the 

United States whether it is foreign-owned or domestic-owned. I do 

not know the breakout, whether the loss has been concentrated or 

not in particular companies. 

Mr. Hill. OK. Let me give Senator Brownback the opportunity 

to ask a few questions here now as well. 

Senator Brownback. Thanks, Mr. Chairman. 

Thanks for the data and the information. We had Chairman 

Bernanke in earlier this week and he was talking about the growth 

in the export market that was taking place as one of the great 

sides of the economy. 

Do you see any of that reflected in your employment data of either strength or less weakness in employment and export-oriented 

sectors? 

Mr. Hall. I would say it is really hard for us to match job gains 

or losses in exports directly certainly on a month-to-month basis, 

so I really could not say. 

Senator Brownback. You mentioned that the construction industry—when you say on month-to-month, do you see any trend 

lines on the export on a broader—on a longer basis on employment 

related to exports broader than a few months? 

Mr. Hall. No, no, I really don’t. It is the sort of thing where you 

can do some research and get some idea of what export-related employment might be, but it is not something we measure directly. So 

we have really no way of linking particular jobs to exports. 

For example companies that export quite often will sell some domestically and some abroad, and it is very hard to separate it out. 

Senator Brownback. I have been touring a number of places 

in my state and manufacturing industries had experienced a significant fall off of employment over the past several years but have 

8

been experiencing some strength recently with the declining value 

of the dollar. I didn’t know if that is happening across the country? 

Mr. Hall. Well I guess I am saying it may be, but I am not 

aware of a trend in export-related employment. 

Senator Brownback. The overall unemployment rate rose to 

5.1 percent. Where was that rate a year ago? Where were we at 

a year ago? Do you recall? Do you have that in any of your data? 

Mr. Hall. Yes I think I had it—Yes, 4.4 percent. 

Senator Brownback. OK and so has it steadily risen during 

that period of time? Or did we see a major jump up in this first 

quarter of this year? What are you seeing on the numbers? 

Mr. Hall. Well we have seen some month-to-month variation, 

but if you look at say quarterly averages of the unemployment rate, 

in the first half of the year the unemployment rate was—of last 

year, I am sorry—the unemployment rate was about 4.5 percent. 

Then in the third quarter it went 4.7. In the fourth quarter it went 

4.8. And now this quarter it is 4.9. So it has been steady. 

Senator Brownback. So there has been a steady deterioration 

since about the middle of last year? 

Mr. Hall. That’s correct. 

Senator Brownback. So would we ascertain from that that the 

economic slowdown started roughly the middle of last year? Or you 

do not draw that kind of conclusions from this data? 

Mr. Hall. Well I would certainly say the labor market weakness 

started over a year ago. 

Senator Brownback. You were hesitant to use the word ‘‘recession,’’ but would you say we are in a recession relative to unemployment rates? 

Mr. Hall. I would not want to make that judgment. You know 

again because if—the important thing about a recession is that it 

lasts for longer than just a few months. 

Senator Brownback. Well the definition is two quarters of negative growth is what I have always understood the kind of classic 

definition of a recession is. 

Mr. Hall. Yes. That was a rule of—that has been sort of a rule 

of thumb. That rule of thumb actually was broken the last recession. We never did have two consecutive quarters of decline. 

I can tell you that the Business Cycle Dating Committee of the 

National Bureau of Economic Research, the ones that are actually—have as closest to an official declaration of a recession—they 

look at a lot of things. They cite particularly the labor market and 

personal income and industrial production as really important data 

that they look at in declaring a recession. 

Senator Brownback. Now Chairman Bernanke talks about 

slow performance late last year, you know, the signs of a recession 

this year—I think he carefully tries to choose his words—but then 

looking at an upward growth in the economy in the second half of 

this year. 

Do you do any soliciting of groups that you survey to see if they 

have employment projections or what they are anticipating to do 

looking down the next quarter, two quarters? 

Mr. Hall. No, we do not, and the real reason is that we are too 

close to the data. We are the ones who produce the employment 

data, and we want to give every appearance and every reason for 

9

people to trust us that we are just reporting the facts. So we stay 

away from trying to project data in any way. 

The exception would be we do do some projections on long term, 

10-year projections on occupations, but that is not really related to 

the business cycle. 

Senator Brownback. OK. And the biggest falloff in employment has been the construction industry? 

Mr. Hall. That is the one that has been declining the longest. 

And this month that was the biggest decline. 

Senator Brownback. What of the 80,000 job loss was associated with the construction industry? 

Mr. Hall. I think it was about to fifty, was it fifty-four? Fiftyone thousand. 

Senator Brownback. Oh boy. So you are looking at well over 

60 percent of the job loss is in the one industry alone, construction? 

Mr. Hill. Yes, but there were several other industries that also 

had job losses that were made up by job gains in other industries. 

For example, as I mentioned, education and health care had 

strong job growth. So there were other industries that had job 

losses that outweighed the increase in say health care and education. 

Senator Brownback. What were the other major ones? 

Mr. Hall. Well manufacturing this month was the second-biggest 

decline. 

Senator Brownback. With how many job losses there?. 

Mr. Hall. I’m sorry, I should remember this. I just looked at it—

a 48,000 job loss. 

Senator Brownback. OK and what is behind them? What is the 

next one behind it? 

Mr. Hall. Let me grab my data here really quickly. Professional 

business—professional and business services lost 35,000 jobs. 

Senator Brownback. What is in that category? What is the big 

one in that category? 

Mr. Hall. That includes employment services and temporary 

help. That particular sector in particular lost a number of jobs. 

Senator Brownback. So that is telling us that companies are 

not putting on temps? Is that what you are saying to us? 

Mr. Hall. Yes. 

Senator Brownback. And that—I mean it seems to me that 

that would be one of the first moves the company would make. The 

first thing would be well we are not going to hire any temps this 

month. 

Mr. Hill. Yes, that is part of why I think that is an important 

thing to note, that that is a concern. 

Senator Brownback. So if you took construction and manufacturing together, what percentage of the job loss—was it well over 

100 percent? 

Mr. Hall. Right. 

Senator Brownback. I mean if we are just looking at those 

numbers because it was offset by gains in education and health 

services? 

Mr. Hall. Correct. 

Senator Brownback. Those are the—the big losing areas are 

construction and manufacturing? 

10

Mr. Hall. Yes. 

Senator Brownback. And you don’t provide any more granular 

data on manufacturing as to which sectors in manufacturing? 

Mr. Hall. Well we have a split-out between durable and nondurable goods, for example. 

Senator Brownback. The reason I am asking this is, you know 

obviously we are looking at a number of policy issues up here for 

what we can do to try to stimulate the growth, and I think 

everybody’s key focus has been on the housing market and what we 

can do to stimulate the housing market, which would certainly be 

supported by your data. And then some people are—well I—certainly saying we cannot raise taxes in this environment because 

that is going to hurt the economy when it is clearly in difficulty. 

So whether it is in durable or nondurable may really tell us 

something about the consumer nature of this. 

Mr. Hall. Well we do have it split out where we have been 

breaking out housing-related industries. So we collect all the industries that are related to the housing market. 

The housing-related industries together lost about 68,000 jobs 

this month. 

Senator Brownback. 68,000 in all housing-related. So that 

would include your durable goods that you put into a house? Is 

that what you’re telling me? 

Mr. Hall. Yes, and it would include some services as well. It is 

everything from furniture to real estate services, to things like——

Senator Brownback. So that fall-off in the housing market is 

a key piece of this data. That is the big piece of this data? 

Mr. Hall. Yes. But I would say though that the weakness is 

much broader than that. There is weakness well beyond just the 

housing-related industries. And there is now some job loss in industries that have nothing to do with housing. 

Mr. Hill. Let me interject here for just for a minute, if——

Senator Brownback. I’m sorry, I thank you for letting me question——

Mr. Hill. No—and if you have more questions feel free to ask 

them. 

But I want to make sure this math adds up here. We lost 80,000 

jobs in March, correct? 

Mr. Hall. Yes. 

Mr. Hill. But you mentioned that we lost 51,000 in construction 

jobs in March? 

Mr. Hall. Yes. 

Mr. Hill. And 48,000 in manufacturing? 

Mr. Hall. Yes. 

Mr. Hill. And 35,000 in ‘‘others’’? 

Mr. Hall. Yes. 

Mr. Hill. That adds up to 134,000 jobs. 

Mr. Hall. Right. Now there is little overlap, for example, because 

some of the manufacturing is related to housing. And then, you 

know, we had some industries with job gains. So on net it came out 

to be a negative 80,000. 

Mr. Hill. OK, how many jobs in the health and education field 

were gained? 

Mr. Hall. 42,000 jobs. 

11

Mr. Hill. 42,000 new jobs were gained? 

Mr. Hall. Yes. 

Mr. Hill. OK, that answers my question then. 

Senator, feel free to ask more questions. 

Senator Brownback. Thank you for letting me do this, and 

thank you for participating with me on this. I mean this really 

helps to try to figure what we ought to be targeting with this. 

On the manufacturing side of the job loss, is this part of a longterm trend? Or is this part of, if you take out the housing market 

on this and the durable-good manufacturing, which I don’t know if 

you do split that out that way, but is this just a continuation of 

a long-term trend? Or is this a part of the weakness in the economy? 

Mr. Hall. It looks to me like it is part of the weakness in the 

economy. The long-term trend has been for manufacturing to shed 

a few jobs, but the job loss in manufacturing has accelerated as the 

general labor market weakness has increased. 

Senator Brownback. OK, and it is primarily in durable goods 

in manufacturing? Or what is the breakout on that? 

Mr. Hall. OK. Well, for example, just this month about 35,000 

in durable goods, about 24,000 of that was in motor vehicles and 

parts. And in nondurable goods, it is about 13,000. 

Senator Brownback. 13,000 in nondurable? 

Mr. Hall. Right. 

Senator Brownback. And what is it in automotive, 28,000? 

Mr. Hall. About 24,000. 

Senator Brownback. 24,000 of the 34,000 in durable? 

Mr. Hall. Yes. 

Senator Brownback. OK, so we have got a real weakness in 

the automotive sector continuing there? Correct? 

Mr. Hall. Correct. 

Senator Brownback. And that is showing up. And then what 

is the big piece in the nondurable? 

Mr. Hall. To be honest, it is pretty broad. Everything from food 

manufacturing, textile mills, apparel, petroleum and coal products, 

plastic and rubber products, those all lost jobs within the nondurable goods sector. 

Senator Brownback. Any thought as to why on those? 

Mr. Hall. I don’t, but it is certainly consistent with just the general weakening in the economy. 

Senator Brownback. That people are just spending less 

money? 

Mr. Hall. Yes. 

Senator Brownback. So that the stimulus package which put 

forward toward consumers is one we would hope would go at that 

particular sector? 

Mr. Hall. Exactly. Yes. And actually it would hopefully affect everything. 

Senator Brownback. What about the financial activities sector? 

Because, you know, we had the big Bear Stearns bailout and the 

problems there. Are we seeing substantial job losses in that category? 

Mr. Hall. Yes, the financial activities sector lost about 5,000 

jobs. It is actually a bit weaker than that in the sense that that 

12

is normally a sector that has pretty solid job growth. So has weakened to the point where I guess we lost 5,000 jobs this month. 

Senator Brownback. So that one is more alarming than the 

number might portend because it has been a growth sector? 

Mr. Hall. Yes. 

Senator Brownback. OK. All right, thank you for breaking 

that out. 

Any thoughts on policy issues that are helpful or harmful? I 

think everybody here wants to see what we can do that would be 

helpful, particularly in the job creation and sustaining roll. 

Mr. Hall. I am afraid I am constrained by my job since the Bureau produces the data and we want to remain objective and just 

let the data speak for itself as much as possible. So I want to steer 

clear of talking about policy issues. 

Senator Brownback. A wise man. 

Thank you, Mr. Chairman. 

Mr. Hill. Thank you, Senator. 

Dr. Hall, we appreciate your testimony. Senator Brownback 

pointed to the fact that the unemployment rate rose 5.1 percent 

last month, and your testimony in answer to his question was that 

this was not a spike but more of a trend upwards. 

Yesterday, the Department of Labor reported that last week applications for unemployment benefits rose above 400,000. Before 

this, we are learning that those who have applied for unemployment insurance have had their unemployment insurance expire because they have been out of a job for longer that what the law allows. 

I know we do not like to define whether or not—with these statistics whether or not we are in a recession, but many economists 

consider this 400,000 mark as an indication that the labor market 

is in a recession. 

Your comments? 

Mr. Hall. In particular that data is a weekly series so it is highly volatile. It has got value, but to some degree it is sort of trumped 

I think by the payroll data. Once we report the payroll data like 

we are today, you have got sort of the same information that you 

got from the unemployment insurance claims. 

Now to the degree this may imply something about next month’s 

employment report, I don’t know. 

Mr. Hill. What share of the U.S. population has a job right now? 

Mr. Hall. I have to look that one up. About 62.6 percent. 

Mr. Hill. OK, and how long has it been since the share of Americans with a job was this low? 

[Pause.] 

Mr. Hall. I’m sorry but it will take me a minute to dig that out. 

Mr. Hill. OK. 

Mr. Hall. Since March of 2005. 

Mr. Hill. March of 2005. 

Senator Brownback in his remarks commented that we are trying to figure out what we should be doing from our end in order 

to stem the tide of all these negative statistics. Some have argued 

that we need to pass legislation to extend benefits to the long-term 

unemployed because the unemployment rate remains relatively 

low. 

13

In the recessions of the early 1990s and early 2000, the unemployment rate was at 7 percent and 5.7 percent, respectively. It 

was at that time that Congress extended unemployment insurance 

benefits higher than it is today. As a matter of policy do you have 

any comment as to whether this is a wise approach that we should 

be looking at? 

Mr. Hall. I think I am going to give a similar answer to what 

I did a minute ago. Since the Bureau of Labor Statistics is producing this data and we want to keep our reputation as being objective reporters of data, I am going to try not to give an opinion 

on policy issues. 

Mr. Hill. You are good at not being pinned down, Dr. Hall. 

Let me switch gears here a bit. The dollar is very low right now. 

It seems to me that because the dollar is low that exports ought 

to be going up. Are exports going up in this country? 

Mr. Hall. We do not produce the export data but I think export 

growth has been fairly strong for a period, but I don’t have that 

data right in front of me. 

Mr. Hill. Do you have any data showing what kind of employment rate is tied to exports? 

Mr. Hall. No, we do not. 

Mr. Hill. OK. My understanding is that wage growth should be 

tied to the productivity of workers. Is it correct that output per 

hour in the nonfarm business sector has grown at a 1.9 percent average annual rate, but the real hourly compensation, pay-plus-benefits, of workers producing that output actually decreased 0.5 percent in the fourth quarter of 2007? Looking at this graph to my 

left, you can see that real earnings have dropped over the last several months. 

Your comments? 

Mr. Hall. Well those figures that you just quoted are correct. 

Would you like me to talk about productivity and wage growth a 

little bit? Is that what——

Mr. Hill. Yes, please. 

Mr. Hall. Oh, sure. Historically there has been a pretty good 

link between productivity growth and real wage growth, in particular productivity growth and real hourly compensation, labor 

compensation which includes both wages and non-wage benefits. 

The numbers that you cite show that the gap between labor productivity and real compensation growth is actually wider than it 

usually is. 

Now it is not unusual for this gap to get wide after a recession 

as part of the business cycle, but usually by this point that gap has 

closed. And this time it is not yet closed. 

Mr. Hill. Is this a trend? And if it is, does this trend tell us anything about the state of the economy? 

Mr. Hall. Well obviously I don’t know what the trend is going 

to be like going forward. And, to be honest, I do not know what this 

is going to tell us about the economy if this gap does not close. 

All I can tell you is that this gap has always closed pretty much 

between 1973 and say 2001. The gap has been pretty constant at 

a fairly narrow rate of something like a half a percentage point. 

Mr. Hill. Since when did you say? 

Mr. Hall. Since 1973 to 2001. 

14

Mr. Hill. OK. Employers labor costs include not only wages and 

salaries but also benefits. When labor costs rise to increases in 

health insurance, how does that affect your measures of employee 

compensation? 

Mr. Hall. Well we do have measures of employee compensation 

that include health insurance costs when the health insurance is 

provided by employers. So when the health-insurance costs go up, 

compensation does go up by our compensation measures. 

Mr. Hill. OK, we are getting near the end of the questions that 

I have. I would invite Senator Brownback, if he has any further 

questions, before I end up this committee meeting to ask his questions. 

Senator Brownback. Thank you, Mr. Chairman, and thank you 

for allowing me to ask so many. 

I find this real interesting. In part of your report you are saying 

the duration of unemployment has shortened at this point in time 

from what it was a year ago. Is that correct? 

Mr. Hall. Let me scramble for just a second and get the data 

here. 

Senator Brownback. You are saying that the duration, the 

mean, the average duration of unemployment decreased in March 

of 2008 to 16.2 weeks from 16.8 weeks in the preceding month, and 

a year ago it was 17.2 weeks. 

Mr. Hall. I am sure that is correct. I just want to find the data. 

Senator Brownback. Well it just kind of jumped out at me because I had thought that would have gone differently but it would 

have a bearing on whether or not to extend unemployment benefits. 

Mr. Hall. Yes. I think the thing that is probably indicating is 

that when job loss—when we start to lose jobs the duration goes 

down because you have newly unemployed people. 

Senator Brownback. Ah, thank you. OK, so that that is a reflection of the bigger number of unemployment taking place, rather 

than that people are unemployed for a less period of time. 

Mr. Hall. Correct. 

Senator Brownback. All right. Thank you for explaining that 

because I looked at that and it seemed odd to me. 

Thank you, very much. 

Thank you, Mr. Chairman. 

Mr. Hill. Thank you, Senator. 

Consumer spending has remained stagnant in February. It was 

0.1 percent in January. In your view does this trend portend for 

the labor market—in your view, what does this trend portend for 

the labor market in the months to come? 

Mr. Hall. Well I kind of want to stay out of the business of forecasting the labor market. Again, because we produce the data I do 

not want to sort of try to guess what the data is going to be. 

Mr. Hill. But there is a connection between consumer spending 

and this trend, right? 

Mr. Hall. Oh, absolutely. Absolutely. And consumer spending actually has been weakening, and I think that has been part of this 

broader weakening in the labor market, is because consumer 

spending is going down. That’s sort of why we are probably seeing 

15

the job loss or job weakness extending beyond just housing-related 

industries. 

Mr. Hill. I know of your reluctance to define whether or not we 

are in a recession, but if at some point that we declare that we are 

in a recession, how long does it take for employment to recover to 

its pre-recession peak? 

Mr. Hall. The last four recessions, the average time was about 

20 months. The most recent recession was unusually long. That 

took 39 months. 

Mr. Hill. And how long do wages and other compensations take 

to recover? 

Mr. Hall. Well in terms of the level, the level of wages is very 

quick. Because wage growth does not pause very much. That is 

only maybe a couple of quarters. But in terms of—not in terms of 

levels but in terms of growth of wages, in the last couple of recessions wage growth rates have never recovered actually. 

Mr. Hill. OK. So based upon your analysis of today’s report, I 

know you were not willing to say that we are in a recession, but 

does it appear that we may be in a difficult period for the labor 

market in the months to come? 

Mr. Hall. I will say, I hope not. 

Mr. Hill. You hope not? 

Mr. Hall. Yes. 

Mr. Hill. And that is all you will add? 

Mr. Hall. Again, I do not want to forecast what our future data 

may look like. 

Mr. Hill. I want to take a step back to the long-term unemployed. The number of long-term unemployed is still higher than 

it was at the beginning of the last recession. Is that correct? 

Mr. Hall. That is correct. 

Mr. Hill. OK. So, Dr. Hall, and your colleagues, we thank you 

very much for coming here this morning. Obviously the numbers 

that you have reported here today are not good, but we must as 

Members of Congress face the reality that this economy is sputtering along. 

If you are unwilling to define it as a recession, I think it is fair 

to say that this economy is in trouble. Would you be willing to say 

that? 

Mr. Hall. I would say that the labor market is certainly weaker 

than we would like to see it, and it has certainly been weakening. 

Mr. Hill. Well, there are people suffering out there. I mean, we 

deal with these statistics but the statistics are statistics of real people and real pain out there among people who are struggling to 

make a living. Not only are they losing their jobs, but they are paying over $3 a gallon for gasoline. Their health-care costs are going 

up. In my state, property taxes have been going up dramatically, 

and I believe that we should recognize that people are suffering out 

there and that the Congress needs to respond to try to provide 

some relief. 

So with that said, let me thank you all for appearing here this 

morning. We appreciate your willingness to come, and we thank 

you for the data that you have provided to us this morning. 

Mr. Hall. Thank you. 

Mr. Hill. This committee is adjourned. 

16

[Whereupon, at 10:18 a.m., Friday, April 4, 2008, the hearing 

was adjourned.] 

(17)

Submissions for the Record 

PREPARED STATEMENT OF SENATOR SCHUMER, CHAIRMAN

SCHUMER: TODAY’S JOBS REPORT IS A SHOT ACROSS THE BOW

Joint Economic Committee Holds Hearing with BLS Chairman on Employment Picture Showing 80,000 Jobs Lost in March and 232,000 in 2008

Today, the Bureau of Labor Statistics (BLS) released the monthly jobs report that 

showed a loss of 80,000 jobs in March and 232,000 jobs lost over the last three 

months. Sen. Charles E. Schumer, the Chairman of the Joint Economic Committee 

(JEC), released a statement on these bleak numbers and their impact on our economy. The JEC convened a hearing on the employment situation this morning with 

the BLS Commissioner, Keith Hall, chaired by Rep. Baron Hill (D-IN). 

Sen. Schumer’s statement follows: 

‘‘Today’s jobs report is a shot across the bow for the administration that has not 

acted in the face of serious economic troubles. Even with falling home prices, rising 

foreclosures, job losses, and no economic growth, we have an administration that refuses, in a Hoover-like way, to take off its ideological handcuffs and help the economy. It’s no surprise that nearly 80% of Americans are pessimistic about the direction of our country right now.’’

‘‘And the Bush administration continues to be a day late and a dollar short in 

responding to the economic realities we are facing. The President is traveling abroad 

this week, but in reality he’s been on a year-long vacation from the country’s economic problems. President Bush is literally and figuratively in Bucharest.’’

‘‘Today’s job report is alarming and much weaker than expected. We lost 80,000 

jobs in March—the third straight month of losses—the first time in 5 years we’ve 

experienced such a string of job loss.’’

‘‘As if the March news wasn’t bad enough, we have also learned today that job 

losses for January and February were worse than reported. We now know that 

60,000 more jobs were lost than the government data showed last month.’’

‘‘Chairman Bernanke was here on Wednesday and he came as close to saying that 

we’re in a recession as he has so far. He walked up to the door, knocked on it, and 

someone opened it—but he didn’t walk in. It crystal clear to Americans that we’re 

in a recession. The report of 80,000 jobs lost in March, and 232,000 jobs lost so far 

this year, is an elephant in their living rooms.’’

The Joint Economic Committee, established under the Employment Act of 1946, was 

created by Congress to review economic conditions and to analyze the effectiveness of economic policy. 

www.jec.senate.gov 

###


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18

PREPARED STATEMENT OF REPRESENTATIVE BARON P. HILL

Good morning. I am honored that Chairman Schumer and Vice Chair Maloney 

have asked me to preside today. 

I want to welcome Commissioner Hall and thank him for testifying here today on 

the March employment situation. 

I have a vested interest in these numbers as I have seen first hand how the recent 

economic downturns have affected my constituents. In Bloomington, Indiana, the 

GE refrigerator plant announced in February that it will close by the end of 2009. 

This will result in a loss of 900 jobs for the area. Job losses like this are occurring 

throughout the country, as today’s employment numbers highlight. 

The labor market news keeps getting worse and today’s report is no exception. 

The unemployment rate jumped to 5.1 percent in March and nonfarm payroll employment fell 80,000 jobs. March marks the third consecutive month of jobs losses, 

for a total of 232,000 jobs lost in the first quarter of this year. We haven’t seen job 

losses like this for nearly five years. 

On Wednesday, Federal Reserve Chairman Ben Bernanke told this committee 

that a recession is possible. Yesterday brought news that weekly unemployment 

benefit claims rose above 400,000, a level that typically signals that the labor market is already in recession. Indeed, the Federal Reserve and many private sector 

economists expect unemployment to climb throughout the year. 

We seem to be a long way away from a healthy economy—which usually adds 

about 150,000 to 200,000 jobs each month—since the economy has lost 77,000 per 

month on average in the first quarter of this year. The widespread job losses we 

are seeing are a clear indication to me that the economy is in trouble. 

For nearly two years now, the manufacturing industry has shrunk and since the 

beginning of 2006, motor vehicles and parts manufacturing alone has lost 172 thousand jobs. These trends adversely affect my state’s economy, as Indiana has a high 

proportion of manufacturing jobs compared to the rest of the country. In Indiana 

we have seen an average unemployment period of 9 weeks. And, as of the fourth 

quarter of 2007, 40 percent of unemployed Hoosiers have now exhausted their unemployment benefits, the eleventh highest rate in the nation. 

Congress should consider a proposal to provide an extension of unemployment 

benefits that would last an additional 13 weeks for those who have exhausted their 

regular six month benefits while looking for a new job. Workers who could receive 

these benefits are those who have lost their job through no fault of their own—they 

have the bad luck of working for a business that must lay off workers or close it 

doors due to the weakening economy, like the workers in the Bloomington GE plant. 

Extending unemployment benefits to struggling workers should be a high priority. 

Wages are not keeping up with the rising cost-of-living. Sky-high gas prices and 

rising healthcare costs add to the pinch for families. These elements have combined 

to create the lowest consumer outlook for the economy in 35 years. 

I want to thank Mr. Hall and his colleagues for being here to discuss today’s labor 

statistics, and I look forward to the continued focus on labor market conditions by 

this Committee. 

PREPARED STATEMENT OF KEITH HALL, COMMISSIONER, BUREAU OF LABOR

STATISTICS

Mr. Chairman and Members of the Committee: 

Thank you for this opportunity to discuss the March labor market data we released this morning. 

Nonfarm payroll employment continued to trend down in March, and the unemployment rate rose from 4.8 to 5.1 percent. Payroll employment edged down by 

80,000 over the month, bringing the decline over the last 3 months to 232,000. To 

put these recent changes into context, I would note that labor market conditions 

started to weaken more than a year ago. Average monthly job growth slowed from 

175,000 in 2006 to 107,000 in the first half of 2007, to 76,000 in the last half of 

2007, and to -77,000 for the first quarter of this year. The unemployment rate remained at or near 4.5 percent during the first half of 2007 but rose to 4.7 percent 

in the third quarter, 4.8 percent in the fourth quarter, and 4.9 percent in the first 

quarter of this year. 

Returning to the payroll employment figures for March, job losses occurred in construction, manufacturing, and employment services. Job growth continued in health 

care, food services, and mining. 

The construction industry lost 51,000 jobs over the month, with declines concentrated in residential and nonresidential specialty trade contracting. Since its 

peak in September 2006, construction employment has fallen by 394,000. 

19

Manufacturing employment decreased by 48,000 in March. Motor vehicle manufacturing employment was down by 24,000; this decline largely reflected the impact 

of a strike at an automotive parts maker. The resulting parts shortage triggered 

plant shutdowns and idled workers at non-striking motor vehicle factories. Elsewhere in manufacturing, there were job declines in several construction-related industries—wood products, furniture, and nonmetallic minerals. Both manufacturing 

hours and overtime were up by one-tenth of an hour. 

In the service-providing sector, employment services shed 42,000 jobs in March. 

This industry group includes temporary help services. Over the past 12 months, employment services has lost 158,000 jobs, three-fourths of which were in temporary 

help. Professional and technical services employment was little changed for the 

third consecutive month, compared with average monthly job gains of 27,000 in 

2007. 

Elsewhere in the service-providing sector, employment growth continued in health 

care and in food services; each industry added 23,000 jobs in March. In the goodsproducing sector, mining employment rose by 6,000 due to gains in oil and gas extraction and related support activities. 

Average hourly earnings for production and nonsupervisory workers in the private 

sector rose by 5 cents in March and have increased by 3.6 percent over the past 

12 months. From February 2007 to February 2008, the Consumer Price Index for 

Urban Wage Earners and Clerical Workers (CPI-W) rose by 4.5 percent. 

Turning to labor market data from the survey of households, the number of unemployed and the unemployment rate both rose over the month. The jobless rate was 

5.1 percent in March, up from 4.8 percent in February and from 4.4 percent in 

March of last year. Over the month, the number of unemployed persons grew by 

434,000 to 7.8 million. The number of unemployed persons who were job losers continued to trend up. Job losers represented 54 percent of all unemployed persons in 

March, up from 48 percent 12 months earlier. (Other groups of unemployed persons 

include those entering the labor market for the first time, those re-entering after 

an absence, and those who voluntarily leave jobs.) About 1.3 million unemployed individuals had been searching for work for 27 weeks or more, little changed from a 

year earlier. 

The number of persons in the labor force increased in March, reversing a decline 

in the prior month. The labor force participation rate has been at or near 66.0 percent since last spring. In March, 62.6 percent of the population was employed, down 

from a recent peak of 63.4 percent at the end of 2006. The number of persons working part time who prefer full-time employment showed little change over the month 

but has risen by 629,000 over the past 12 months. 

In summary, payroll employment continued to trend down in March, and job 

losses have totaled 232,000 for the first 3 months of the year. The unemployment 

rate rose to 5.1 percent. 

My colleagues and I now would be glad to answer your questions. 

PREPARED STATEMENT OF SENATOR SAM BROWNBACK

Thank you, Representative Hill, and thank you Commissioner Hall for appearing 

before this committee. We are all very interested in hearing about recent developments in our Nation’s labor markets. 

Today’s news that the economy lost 80,000 payroll jobs last month and that the 

unemployment rate rose to 5.1% is disappointing all of us. However, the unemployment rate does remain low by historical standards. 

I will be interested to hear the degree to which job losses remain confined primarily to the manufacturing and construction sectors or if weakness has spread to 

other sectors as well. 

We often hear from the other side of the aisle that, somehow, the administration’s 

policies are responsible for low growth in inflation-adjusted wages, high unemployment rates in some sectors of the labor markets, and anemic economic growth. 

Somehow, the administration’s policies simply favor the rich, or look out for Wall 

Street, instead of Main Street. I have yet to hear from the other side, however, preVerDate 0ct 09 2002 09:13 Dec 11, 2008 Jkt 045038 PO 00000 Frm 00023 Fmt 6601 Sfmt 6621 C:\DOCS\42946.TXT CELINA PsN: BACKUP

42946.001
20

cisely what those policies are that are responsible for some of the slowdown in economic activity that we are currently observing. Is it low taxes that lead to slower 

economic activity or the discrepancy between productivity growth and wage growth? 

Is that the policy that is responsible for the economic slowdown? 

You might even think, given budget proposals from the other side of the aisle, 

that allowing current tax policy to expire—which is the same thing as increasing 

taxes without taking votes—will help stimulate out economy. I wonder what set of 

economic principles lead those on the other side of the aisle to believe that the higher taxes and bigger government that they seek will give rise to more prosperity in 

the private sector. To the contrary, I believe that if we allow pro-growth tax policies 

that we instituted in 2001 and 2003 to continue, then we will allow the American 

people to keep more of their hard-earned income to use to provide for their families. 

The economic lessons that I learned in school suggest that if we keep taxes low, 

and we work toward a leaner and more efficient government, then people have the 

proper incentives to work hard for their families because they can keep their hard 

earned income, choose how to use it for their families well being, and not have to 

send money to fund inefficient government spending. 

I am anxious to hear about the status of our Nation’s labor markets and look forward to Commissioner Hall’s testimony.

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