TEXT

 
 
 
 
                                    FOR DELIVERY: 9:30 A.M., E.D.T.
                                    FRIDAY, JUNE 3, 1994
 
 
 
        ___________________________________________________________
        Advance copies of this statement are made available to the
        press under lock-up conditions with the explicit
        understanding that the data are embargoed until 8:30 a.m.
        Eastern time.  ____________________________________________
 
 
                                Statement of
 
                            Katharine G. Abraham
                                Commissioner
                         Bureau of Labor Statistics
                                     on
                                June 3, 1994
 
 
 
 
 
             Thank you for joining us here this morning.  I would
 
        like to offer a few comments to supplement today's
 
        Employment Situation news release, and my colleagues and I
 
        would then be happy to answer any questions that you may
 
        have.
 
             As was reported earlier this morning, the nation's
 
        unemployment rate fell in May and the number of payroll jobs
 
        continued to rise, but at a more modest pace than in the
 
        prior 2 months.  The measure of total employment from the
 
        household survey registered a large gain in May; this brings
 
        its year-to-date increase more in line with that exhibited
 
        by the payroll survey.  As an aside, I would note that
 
        payroll employment estimates have been revised to reflect
 
        the benchmarking to the March 1993 universe count and
 
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        updated seasonal factors.  I will discuss these revisions in
 
        a few moments.
 
             Since December, the number of payroll jobs has
 
        increased by 1.2 million, an average of 247,000 a month.
 
        Since January, the first month in which household estimates
 
        were obtained from the revised Current Population Survey,
 
        total employment has risen by about 900,000, an average of
 
        225,000 a month.  More than half a million of this gain was
 
        recorded in May.  Results from both surveys show the pace of
 
        job growth thus far in 1994 to be somewhat above the average
 
        for 1993.
 
             The over-the-month fall in the jobless rate, from 6.4
 
        to 6.0 percent, brings the total decline since January to
 
        seven-tenths of a percentage point.  The rates for adult men
 
        and adult women have declined by roughly equal amounts since
 
        the start of the year; the rate for teenagers has shown no
 
        clear trend.  Whites, blacks, and Hispanics all have shared
 
        in the unemployment rate reduction.  The number of
 
        unemployed persons, 7.9 million in May, has fallen by about
 
        800,000 since January.  In examining these figures, data
 
        users should remember that, whenever unusually large
 
        movements occur in a single month, the magnitude of those
 
        changes often turns out to have been overstated once
 
        additional data become available.  It nonetheless is clear
 
        that unemployment continues to trend downwards.
 
 
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             Each month since January, the Bureau has prepared a
 
        projection of what the unemployment rate would have been had
 
        we continued to conduct our household survey using pre-1994
 
        methods.  The graph attached to my statement plots our best
 
        estimates of unemployment as it was or would have been
 
        measured, using both the old and the new survey methods, for
 
        the period January 1993 to May 1994.  This graph should,
 
        however, be interpreted cautiously since the projections for
 
        the later months of 1994 are inherently less reliable than
 
        those for the earlier months.
 
             Beginning next month, we had planned to replace these
 
        unemployment projections with data derived from a special
 
        small-scale parallel survey.  This parallel survey using the
 
        old pencil-and-paper collection methods was initiated at a
 
        time when there were serious questions about how the
 
        redesigned household survey would perform in its early
 
        months.  Data from the redesigned survey have, in fact,
 
        behaved quite reasonably and seem to have been well
 
        accepted.  Given the competing pressures on the Bureau's
 
        budget, together with serious technical concerns about the
 
        quality of the data from the new parallel survey, we have
 
        decided to discontinue its collection.
 
             Returning to the results of our employer survey, the
 
        increase of 191,000 jobs reported for May followed much
 
        larger gains in March and April.  The May rise included a
 
        return of about 70,000 strikers in the trucking industry;
 
 
 
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        absent their return, the May gain would have been about
 
        120,000 jobs.
 
             Services accounted for most of the over-the-month job
 
        rise, net of the gains associated with the return of
 
        striking workers.  But in this industry, as in many others,
 
        the pace of growth was much slower than in the prior 2
 
        months.  Business services, in particular, registered an
 
        unusually small increase.
 
             The expansion in construction employment also slowed in
 
        May.  Factory employment was flat, with no noteworthy
 
        changes among the individual manufacturing industries.  Both
 
        the manufacturing workweek and factory overtime hours eased
 
        back a tenth of an hour from extremely high April levels.
 
             Finance, insurance, and real estate experienced an
 
        employment decline, reflecting in part the impact of rising
 
        interest rates on refinancing and home purchases.
 
        Employment gains in retail trade were somewhat more modest
 
        than in recent months, but, generally speaking, retail
 
        employment growth has been quite strong since late last
 
        year.
 
             Today, we are issuing revisions to the payroll
 
        employment series to incorporate our routine annual
 
        benchmark adjustments.  Each year at this time, we re-
 
        calibrate our sample-based survey estimates to full universe
 
        counts, derived principally from a separate BLS program that
 
        aggregates administrative records from the state
 
 
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        unemployment insurance tax system.  The benchmark adjustment
 
        to the seasonally adjusted March 1993 level is an upward
 
        revision of 239,000 jobs, or two-tenths of one percent.
 
             Estimates for the post-benchmark period, April 1993
 
        forward, also have been recalculated, in accordance with
 
        standard practice, to incorporate the shift to a new
 
        benchmark level as well as recomputed bias adjustment and
 
        seasonal adjustment factors.  The benchmark process resulted
 
        in an average upward adjustment of about 25,000 jobs per
 
        month for the period since April 1992, indicating somewhat
 
        stronger job growth than originally reported.  The revisions
 
        to the employment estimates for the benchmark and post-
 
        benchmark time periods are well within historical ranges.
 
             In summary, the job market continued to improve in May.
 
        The unemployment rate declined and total employment from the
 
        household survey registered a substantial increase, bringing
 
        job growth in this survey about in line with that from the
 
        payroll survey for the year thus far.  Payroll job growth
 
        was more modest than it had been in March and April, but
 
        this must be viewed in the context of the past 2 months'
 
        growth having been exceptionally strong.
 
 
 
             My colleagues and I now would be glad to answer any
 
        questions you might have.