Monthly Labor Review February 1999 3

Employment in 1998

Contrasts characterized the job market in

1998. In some industries employment

expanded at an increased rate, while in

others employment ceased to expand. Futhermore, several industries laid off substantial numbers of workers. Low interest rates and the associated high demand for housing contributed to

large gains in employment in construction and

some related industries, including finance. At the

same time, severe economic problems in Asia

reduced foreign demand for U.S. goods, contributing to a loss of almost 170,000 jobs in U.S.

manufacturing. The devaluation of several Asian

currencies made some imported goods more attractive in price, reducing domestic employment

in apparel and other industries. In addition, U.S.

job growth decreased in temporary help agencies

and in health care. Overall, the 2.3-percent U.S.

job gain in 1998 was slightly lower than the average gain of 2.6 percent during the previous 5 years

of expansion in employment. (Chart 1 shows that

the overall rate of job growth from 1993 through

1997 was relatively consistent and similar to that

of the extended expansion of the 1980s.)

In 1998, the unemployment rate reached its

lowest level in nearly three decades. It edged

down early in the year to 4.3 percent and remained near that level for the rest of the year.

Long-term joblessness, however, continued to

account for a relatively large portion of the unemployed.

This article describes changes in the labor

market in 1998, in comparison to trends during

the earlier years of the current expansion. The

data used are from two Bureau of Labor Statistics

(BLS) monthly surveys: the Current Employment

Statistics (CES) survey of work sites and the Current Population Survey (CPS) of households.1

 (See

box on p. 4.)

General economic forces

A variety of both favorable and unfavorable influences affected the job market in 1998. (See

table 1.) The broadest national economic movements were generally favorable. Inflation in 1998

was extremely low, 1.5 percent, as estimated by

the CPI-U, after 5 years of somewhat faster, but

still historically low, inflation. Interest rates became more favorable: the prime rate declined by

0.6 percentage point to 7.9 percent, and the average 30-year fixed mortgage rate fell 0.4 percentage point to 6.8 percent, the lowest rate in any

quarter since continuous records have been kept.2

The gross domestic product continued an expansion that started in early 1991, increasing at the

fairly rapid rate of 4.3 percent in 1998.

Total U.S. exports, however, which had increased for 5 straight years at an average annual

rate of 9.0 percent, fell through the third quarter

in 1998 and increased in the fourth quarter by only

1.2 percent from the level that prevailed a year

Job growth slows

during crises overseas

Foreign economic crises ate into the demand

for U.S. goods and reduced U.S. manufacturing jobs,

but hiring increased in construction, finance,

and government; unemployment was low

throughout the year

William C.

Goodman

and

Timothy D.

Consedine

William C. Goodman is

an economist in the

Division of Monthly

Industry Employment,

Bureau of Labor

Statistics; Timothy D.

Consedine is an

economist in the

Division of Labor Force

Statistics, Bureau of

Labor Statistics.
4 Monthly Labor Review February 1999

Employment in 1998

earlier. Imports into the Nation continued to increase in 1998.

(See table 1.) Both developments cut demand for U.S. manufactured products.

Employment by industry3

The economic performance of industries varied from poor to

excellent in 1998, relative to the previous 5 years of expansion. This section examines, in turn, those industries that

posted reduced, increasing, and stable employment trends

during the past year.

Manufacturing. In 1998, the manufacturing division clearly

fared worst among the nine major divisions into which industries are classified. (See charts 2 and 3.) Manufacturing lost

169,000 jobs (–0.9 percent) over the year; the previous 5 years

had produced average annual gains of about the same magnitude. Of the 20 major industry groups in manufacturing, 15

showed a deterioration in their job trend. About 75 percent of

the deterioration occurred in the durable-goods industries,

among which the change in trend was most severe in fabricated metal products, industrial machinery and equipment,

and electronic and other electrical equipment. (See table 2.)

In each of these three industry groups, job losses in 1998 followed 5 straight years of gains that were cumulatively large,

as shown in the following tabulation:

Fabricated metal products...... 160,000 32,000 –6,000

Industrial machinery and

equipment ............................ 265,000 53,000 –29,000

Electronic and other

electrical equipment ............. 187,000 37,000 –35,000

Of the 29 more specific components making up the three

industry groups, 8 were responsible for most of the groups’

collective downturn in 1998. Seven of the 8 components are

classified as sensitive to exports, on the basis that foreign sales

accounted for at least 20 percent of their domestic output in

1993.4

 (See table 3.)

Among the eight industries, electronic components and

accessories (including such electronic parts as printed circuit

boards and semiconductors) underwent the sharpest reversal

of trend. From 1992 to 1997, the industry gained jobs at the

rate of 5 percent per year, an average of 29,000 jobs annually.

In 1998, the industry lost 21,000 jobs. Of all U.S. manufacMajor industry group Total

Gain in jobs, 1992

to 1997 Change

in jobs,

Annual 1998

average

The Bureau of Labor Statistics maintains two monthly

data series of employment that are independently obtained:

the estimate of total nonfarm jobs, derived from the Current

Employment Statistics (CES) survey, and the estimate of

total employment, derived from the Current Population

Survey (CPS). (The CPS also provides information on unemployment, whereas the CES survey does not.) The CES survey

is an employer-based survey that provides data on the number of jobs within industries, while the CPS is a survey of

households that provides data by demographic characteristics, occupation, and industry. The surveys are largely

complementary.

Employment estimates from the CPS pertain to persons in

any type of work arrangement, including the self-employed

and unpaid workers in family businesses, whereas estimates

from the CES survey refer only to persons on nonfarm payrolls. As a result, the count of employment from the CPS is

larger than that from the CES survey. Partially offsetting the

higher estimate from the CPS is the fact that it is a count of

persons and, as such, includes individuals only once, regardless of the number of jobs they hold. In contrast, the CES

survey is a count of jobs and includes each job for persons

who work in more than one establishment.

Other differences in the surveys’ methodology and coverage also are important. For example, the reference period

for the CPS is the week that includes the 12th day of the month,

while, for the CES survey, it is the pay period that includes

the 12th of the month. Obviously, pay periods vary in length

and can be longer than 1 week. It is therefore possible for

the CES survey estimate of employment to reflect a longer

reference period than that used for the CPS.

Finally, coverage in the CPS includes household members

who are part of the civilian noninstitutional population. Persons who are inmates of institutions, such as those confined

in penal or mental facilities, residents of homes for the aged,

and those who are on active duty in the Armed Forces, are

excluded from the CPS. Also, only households that are in the

United States are eligible to be sampled in the CPS. In this

regard, the coverage of the CES survey is broader: uniformed

military personnel who hold civilian jobs are within its purview because of their civilian employment, and persons who

commute into the United States from Mexico or Canada and

are employed by companies within the United States are

counted as employed in the CES survey estimates.

Conceptual differences between employment estimates

 from the Current Population Survey (household survey)

and the Current Employment Statistics survey (establishment survey)
Monthly Labor Review February 1999 5

turing groups, the electronic components and accessories industry is the most dependent on exports; approximately half

of its output is sold to foreign countries.

Apparel and other textile products, classified as a nondurable-goods-manufacturing industry, also contributed to the

weakness. The apparel industry has consistently lost jobs to

foreign competition, shrinking in 5 of the last 6 years (employment was unchanged in 1994), but the 1998 loss of 74,000

jobs was nearly twice the average of the five preceding declines. Devaluation of the currencies of most Asian nations

made that continent’s textile products cheaper in the United

States; price-slashing by some factories in economically distressed Far Eastern countries added to the effect. As prices of

foreign textile products fell, imports of textile products increased more than in most recent years.5

Services. Employment in the services division (the largest

single part of the service-producing sector, which also includes

retail trade, government, and other service-producing divisions) grew in 1998 at the rate of 3.8 percent, after increasing

by an average of 4.5 percent per year in the previous 5 years.

The division gained about 50,000 fewer jobs than in the average year of the 5-year period. Unlike the internationally influenced weaknesses in manufacturing, the decelerations in the

components of services have no apparent common cause.

Within services, the major groups showing the most severe

decelerations in employment growth were health care and

business services (which includes help supply). (See chart 4.)

The health care industries’ gain of 145,000 jobs in 1998,

though still large, was less than two-thirds of the average of

the preceding 5 years. Nearly all of the slowdown in health

care jobs occurred in home health care and nursing and personal care facilities. In both cases, important changes in medicare reimbursement policies were made in 1998. Federal rates

Table 1. Year-to-year percent change in selected broad

economic indicators,1 fourth-quarter averages,

199398

Nonfarm payroll

employment ................. 2.3 2.7 2.6 2.3

Real gross domestic

product .......................... 3.9 3.8 3.1 4.3

Real gross private

domestic investment ...... 11.0 11.3 8.9 10.1

Consumer Price Index

(CPI-U) ............................. 3.3 1.9 2.7 1.5

Prime lending rate2 .......... –5.4 3.0 8.1 –6.8

Home-mortgage 30-year

fixed interest rate2 .......... 4.9 –6.6 –1.2 –6.0

Real imports .................... 11.8 14.0 10.8 9.9

Real exports .................... 10.3 9.6 9.0 1.2

1 Seasonally adjusted, unless otherwise indicated.

2 Not seasonally adjusted.

199596 199697 199798

199397

average Indicator

Chart 1. Percent change in nonfarm payroll employment, 198598

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

-2

-1

0

1

2

3

4

-2

-1

0

1

2

3

4

Percent Percent

–

–

–

–

NOTE: Shaded area indicates recession, as designated by the National Bureau of Economic Research.

(Fourth quarter to fourth quarter, seasonally adjusted)
6 Monthly Labor Review February 1999

Employment in 1998

Table 2. Employees on nonfarm payrolls, by industry, seasonally adjusted quarterly averages, 199298

[Numbers in thousands]

Total nonfarm ................................................. 109,109 123,934 126,820 3,279 2.7 2,965 2.6 2,886 2.3

Total private ................................................ 90,405 104,271 106,834 3,048 3.0 2,773 2.9 2,563 2.5

Goods producing ..................................... 23,190 25,108 25,222 460 1.9 384 1.6 114 .5

Mining1 .................................................. 622 592 560 9 1.5 –6 –1.0 –32 –5.4

Metal mining ....................................... 52 53 50 –1 –1.9 0 .4 –3 –5.7

Oil and gas extraction ......................... 344 337 313 12 3.7 –1 –.4 –24 –7.1

Nonmetallic minerals, except fuels ........ 102 107 108 0 .0 1 1.0 1 .9

Construction .......................................... 4,504 5,761 6,075 222 4.0 251 5.0 314 5.5

General building contractors ............... 1,078 1,337 1,422 56 4.4 52 4.4 85 6.4

Heavy construction, except building ... 708 794 842 5 .6 17 2.3 48 6.0

Special-trade contractors .................... 2,718 3,629 3,811 160 4.6 182 6.0 182 5.0

Manufacturing ....................................... 18,064 18,756 18,587 230 1.2 138 .8 –169 –.9

Durable goods .................................... 10,232 11,091 11,022 251 2.3 172 1.6 –69 –.6

Lumber and wood products .............. 691 796 808 11 1.4 21 2.9 12 1.5

Furniture and fixtures ....................... 479 513 525 7 1.4 7 1.4 12 2.3

Stone, clay, and glass products ........ 514 554 567 5 .9 8 1.5 13 2.3

Primary metal industries .................. 688 715 700 7 1.0 5 .8 –15 –2.1

Fabricated metal products ................ 1,328 1,488 1,482 29 2.0 32 2.3 –6 –.4

Industrial machinery and equipment 1,926 2,191 2,162 70 3.3 53 2.6 –29 –1.3

Computer and office equipment ..... 382 380 368 17 4.7 0 –.1 –12 –3.2

Electronic and other electrical

equipment ...................................... 1,520 1,707 1,672 39 2.3 37 2.3 –35 –2.1

Electronic components and

accessories ................................. 526 672 651 49 7.9 29 5.0 –21 –3.1

Transportation equipment ................. 1,800 1,872 1,879 74 4.1 14 .8 7 .4

Motor vehicles and equipment ....... 819 999 996 30 3.1 36 4.1 –3 –.3

Aircraft and parts ........................... 585 516 521 45 9.6 –14 –2.5 5 1.0

Instruments and related products ..... 916 867 847 8 .9 –10 –1.1 –20 –2.3

Miscellaneous manufacturing

industries ........................................ 371 387 379 –1 –.3 3 .8 –8 –2.1

Nondurable goods .............................. 7,832 7,665 7,565 –20 –.3 –33 –.4 –100 –1.3

Food and kindred products ............... 1,667 1,696 1,710 9 .5 6 .3 14 .8

Tobacco products ............................. 45 41 40 –1 –2.4 –1 –1.8 –1 –2.4

Textile mill products .......................... 676 611 584 –11 –1.8 –13 –2.0 –27 –4.4

Apparel and other textile products .... 999 811 737 –41 –4.8 –38 –4.1 –74 –9.1

Paper and allied products ................ 693 686 675 2 .3 –1 –.2 –11 –1.6

Printing and publishing ..................... 1,507 1,560 1,566 18 1.2 11 .7 6 .4

Chemicals and allied products ......... 1,084 1,035 1,034 3 .3 –10 –.9 –1 –.1

Petroleum and coal products ............ 154 139 135 –2 –1.4 –3 –2.0 –4 –2.9

Rubber and miscellaneous plastics

products ......................................... 887 1,000 1,006 10 1.0 23 2.4 6 .6

Leather and leather products ........... 119 87 78 –6 –6.5 –6 –6.1 –9 –10.3

Service producing .................................... 85,919 98,826 101,599 2,818 2.9 2,581 2.8 2,773 2.8

Transportation and public utilities .......... 5,734 6,453 6,615 165 2.6 144 2.4 162 2.5

Transportation ..................................... 3,518 4,144 4,259 106 2.6 125 3.3 115 2.8

Railroad transportation ..................... 253 228 234 –1 –.4 –5 –2.1 6 2.6

Local and interurban passenger

transit ........................................... 368 453 468 9 2.0 17 4.2 15 3.3

Trucking and warehousing ............... 1,400 1,678 1,723 39 2.4 56 3.7 45 2.7

Water transportation ......................... 170 180 193 4 2.3 2 1.1 13 7.2

Transportation by air ........................ 964 1,148 1,172 38 3.4 37 3.6 24 2.1

Pipelines, except natural gas ........... 19 14 14 0 .0 –1 –5.9 0 .0

Transportation services .................... 343 443 455 17 4.0 20 5.2 12 2.7

Communications and public utilities .... 2,216 2,310 2,356 60 2.7 19 .8 46 2.0

Communications .............................. 1,267 1,450 1,503 76 5.5 37 2.7 53 3.7

Electric, gas, and sanitary services .. 949 860 853 –16 –1.8 –18 –2.0 –7 –.8

Wholesale trade .................................... 5,959 6,713 6,874 165 2.5 151 2.4 161 2.4

Durable goods .................................... 3,416 3,989 4,101 139 3.6 115 3.2 112 2.8

Nondurable goods .............................. 2,543 2,724 2,772 26 1.0 36 1.4 48 1.8

Retail trade ............................................ 19,452 22,185 22,650 386 1.8 547 2.7 465 2.1

Building materials and garden

supplies ............................................ 761 943 992 28 3.1 36 4.4 49 5.2

General merchandise stores ............... 2,462 2,757 2,831 42 1.5 59 2.3 74 2.7

Department stores ........................... 2,097 2,425 2,497 48 2.0 66 2.9 72 3.0

Industry

Fourth

quarter,

1992

Change, fourth quarter to fourth quarter

Fourth

quarter,

1997

Fourth

quarter,

1998

199697 Average, 199397 199798

Number Percent Number Percent Number Percent
Monthly Labor Review February 1999 7

Food stores ......................................... 3,181 3,515 3,557 51 1.5 67 2.0 42 1.2

Automotive dealers and service

stations ............................................. 1,973 2,327 2,370 34 1.5 71 3.4 43 1.8

New-and used-car dealers ............... 883 1,056 1,070 15 1.4 35 3.6 14 1.3

Apparel and accessory stores ............ 1,132 1,104 1,102 5 .5 –6 –.5 –2 –.2

Furniture and home furnishings

stores ................................................ 801 1,029 1,082 40 4.0 46 5.1 53 5.2

Eating and drinking places ................. 6,695 7,659 7,806 80 1.1 193 2.7 147 1.9

Miscellaneous retail establishments ... 2,448 2,852 2,909 108 3.9 81 3.1 57 2.0

Finance, insurance, and real estate ...... 6,634 7,172 7,441 195 2.8 108 1.6 269 3.8

Finance ............................................... 3,176 3,464 3,608 122 3.7 58 1.8 144 4.2

Depository institutions ...................... 2,085 2,036 2,044 17 .8 –10 –.5 8 .4

Commercial banks ......................... 1,485 1,464 1,457 7 .5 –4 –.3 –7 –.5

Savings institutions ........................ 337 262 265 –1 –.4 –15 –4.9 3 1.1

Nondepository institutions ................ 422 583 648 40 7.4 32 6.7 65 11.1

Mortgage bankers and brokers ...... 196 261 310 19 7.9 13 5.9 49 18.8

Security and commodity brokers ...... 449 616 665 48 8.5 33 6.5 49 8.0

Holding and other investment

offices ............................................. 220 230 251 18 8.5 2 .9 21 9.1

` Insurance ............................................ 2,161 2,282 2,357 45 2.0 24 1.1 75 3.3

Insurance carriers ............................ 1,504 1,551 1,605 29 1.9 9 .6 54 3.5

Insurance agents, brokers,

and service ..................................... 657 731 751 16 2.2 15 2.2 20 2.7

Real estate ......................................... 1,297 1,426 1,476 28 2.0 26 1.9 50 3.5

Services1 ............................................... 29,436 36,639 38,033 1,675 4.8 1,441 4.5 1,394 3.8

Agricultural services ........................... 492 693 736 50 7.8 40 7.1 43 6.2

Hotels and other lodging places ......... 1,578 1,754 1,781 25 1.4 35 2.1 27 1.5

Personal services ............................... 1,122 1,181 1,181 –3 –.3 12 1.0 0 .0

Business services1 ............................. 5,463 8,222 8,719 726 9.7 552 8.5 497 6.0

Services to buildings ........................ 808 950 990 32 3.5 28 3.3 40 4.2

Personnel supply services ............... 1,716 3,072 3,184 335 12.2 271 12.4 112 3.6

Help supply services ..................... 1,494 2,739 2,846 303 12.4 249 12.9 107 3.9

Computer and data–processing

services ......................................... 856 1,477 1,677 188 14.6 124 11.5 200 13.5

Auto repair, services, and parking ...... 893 1,138 1,173 38 3.5 49 5.0 35 3.1

Miscellaneous repair services ............ 351 379 391 6 1.6 6 1.5 12 3.2

Motion pictures ................................... 407 559 564 26 4.9 30 6.6 5 .9

Amusement and recreation services .. 1,210 1,611 1,732 108 7.2 80 5.9 121 7.5

Health services1 .................................. 8,594 9,808 9,953 242 2.5 243 2.7 145 1.5

Offices and clinics of medical doctors 1,483 1,772 1,846 74 4.4 58 3.6 74 4.2

Nursing and personal care facilities . 1,546 1,760 1,753 19 1.1 43 2.6 –7 –.4

Hospitals .......................................... 3,773 3,901 3,979 72 1.9 26 .7 78 2.0

Home health care services .............. 419 714 662 23 3.3 59 11.2 –52 –7.3

Legal services .................................... 915 959 995 26 2.8 9 .9 36 3.8

Private schools and other educational

services ............................................ 1,669 2,154 2,245 95 4.6 97 5.2 91 4.2

Social services1 .................................. 1,998 2,553 2,673 108 4.4 111 5.0 120 4.7

Child day–care services ................... 460 572 586 6 1.1 22 4.5 14 2.4

Residential care ............................... 544 731 764 40 5.8 37 6.1 33 4.5

Museums and botanical and zoological

gardens ............................................. 73 91 93 3 3.4 4 4.5 2 2.2

Membership organizations .................. 2,000 2,251 2,281 25 1.1 50 2.4 30 1.3

Engineering and management

services1 ........................................... 2,492 3,090 3,317 201 7.0 120 4.4 227 7.3

Engineering and architectural

services .......................................... 745 886 931 41 4.9 28 3.5 45 5.1

Management and public relations .... 669 978 1,087 84 9.4 62 7.9 109 11.1

Government ............................................... 18,704 19,663 19,986 231 1.2 192 1.0 323 1.6

Federal .................................................... 2,946 2,689 2,705 –41 –1.5 –51 –1.8 16 .6

Federal, except Postal Service .............. 2,169 1,825 1,829 –50 –2.7 –69 –3.4 4 .2

State government .................................... 4,438 4,611 4,683 27 .6 35 .8 72 1.6

State government education ................. 1,806 1,923 1,956 24 1.3 23 1.3 33 1.7

Other State government ........................ 2,632 2,688 2,727 3 .1 11 .4 39 1.5

Local government .................................... 11,320 12,363 12,598 245 2.0 209 1.8 235 1.9

Local government education ................. 6,270 6,957 7,114 158 2.3 137 2.1 157 2.3

Local government, except education ..... 5,050 5,406 5,484 87 1.6 71 1.4 78 1.4

1Includes other industries not shown separately.

Industry

Fourth

quarter,

1992

Change, fourth quarter to fourth quarter

Fourth

quarter,

1997

Fourth

quarter,

1998

199697 Average, 199397 199798

Number Percent Number Percent Number Percent

Table 2. ContinuedEmployees on nonfarm payrolls, by industry, seasonally adjusted quarterly averages, 199298

[Numbers in thousands]
8 Monthly Labor Review February 1999

Employment in 1998

of payment to home health care agencies under the medicare

program were reduced from earlier rates; the system of reimbursements in place during most of 1998 represented an intermediate stage between the former cost-based reimbursements

and future prospective payments, in which reimbursements are

to be standardized for each diagnostic category instead of being based on actual costs in each individual case. Furthermore,

medicaid payments to home health care agencies were restricted, in aggregate, to rates similar to those of medicare.

Medicare payments to skilled nursing facilities also were

changed in 1998, to a prospective payment system. Medicare

claims were increasingly scrutinized for fraud in the last few

years, and in the new climate entrepreneurial activity appears

to have declined.6 Home health care had been one of the fastest-growing industries in the early years of the current expansion, but the industry’s rate of growth declined from 16.7 percent in 1994 to 3.3 percent in 1997. In 1998, the industry lost

7 percent of its employment. Nursing and personal care facilities showed a similar, though less pronounced, pattern. The

industry gained about 50,000 jobs per year early in the expansion, slowed in growth in 1997, and lost 7,000 jobs in 1998.

Despite the overall slowdown in health care employment,

two of its components showed continuing substantial growth

in 1998. Offices and clinics of medical doctors added 74,000

jobs, a gain that was about 20,000 more than the average gain

in the previous 5 years. Hospitals accelerated greatly in growth

from 1994, when the industry cut jobs in view of the uncertainty of future health care policy, to 1998, when the industry

gained 78,000 jobs. The following tabulation shows the

change in employment in these two industries from 1992 to

1998:

Year Change in employment

Number Percent

Offices and clinics

of physicians:

 1992–93 ................. 34,000 2.3

 1993–94 ................. 51,000 3.4

 1994–95 ................. 69,000 4.4

 1995–96 ................. 61,000 3.7

 1996–97 ................. 74,000 4.4

 1997–98 ................. 74,000 4.2

Hospitals:

 1992–93 ................. –1,000 .0

 1993–94 ................. –12,000 –.3

 1994–95 ................. 24,000 .6

 1995–96 ................. 45,000 1.2

 1996–97 ................. 72,000 1.9

 1997–98 ................. 78,000 2.0

Among the main components of the services division,

health care decelerated by the largest number of jobs, and business services decelerated by the second-largest number. Business services as a whole, while gaining almost half a million

jobs, was 55,000 short of its 5-year average expansion, as relative weakness in the help supply component was only partially offset by strength in computer services and data processing. Help supply services provide temporary workers to

client companies; by definition, then, the industry is affected

by the demand for employees in other industries, as well as

the supply of available workers. Anecdotal evidence suggests

that a shortage of qualified applicants existed in 1998.7

 While

help supply firms added 100,000 workers last year, the increase was less than half of the industry’s 5-year average. The

year 1998 followed 2 years of great acceleration.

Despite the large decelerations in

the services division, certain other industries within services increased their

growth in 1998. Those accelerating

services industries are described later,

along with other industries showing

acceleration in employment.

Mining. The economic performance

of the mining division also was markedly different in 1998 from that of previous years. The division lost about

30,000 jobs (5.4 percent), following

gains in 1996 and 1997 that totaled

18,000. (See table 4.) Nearly all of the

change in trend was in oil and gas extraction, which lost 24,000 jobs. A decline of more than 40 percent in the

Table 3. Changes in the trend of job growth in selected manufacturing industry

groups, 199298

Fabricated structural metal

products ............................... 13,000 3.0 4,000 0.9 <20

Miscellaneous fabricated

metal products ..................... 7,000 3.1 –3,000 –1.1 21

Metalworking machinery ........ 9,000 2.9 –7,000 –2.0 21

Special industry machinery ... 7,000 4.5 –7,000 –3.8 23

Computer and office

equipment ............................ 0 –.1 –12,000 –3.2 46

Miscellaneous industrial and

commercial machinery ......... 15,000 4.7 3,000 .8 31

Communications equipment .. 8,000 3.1 –5,000 –1.8 20

Electronic components and

accessories ......................... 29,000 5.0 –21,000 –3.1 47

NOTE: Changes shown are from the fourth quarter to the fourth quarter.

Industry group

Change in

employment, 199798 Percent of

employment

dependent on Number Percent Number Percent exports

Average annual change in

employment, 199397
Monthly Labor Review February 1999 9

Chart 2. Growth in jobs in 1998, by industry division

Mining

Construction

Manufacturing

Transportation and public utilities

Wholesale trade

Retail trade

Finance, insurance, and real estate

Services

Government

(500) 0 500 1,000 1,500 2,000 0

NOTE: Changes are from the fourth quarter of 1997 to the fourth quarter of 1998. Data are preliminary. The transportation and public 

utilities division includes the communications industry.

Thousands

–500

price of domestic crude petroleum over the year reduced the

incentive for production.8 Oil production in Oklahoma reportedly has fallen to its lowest level since 1919.9

Employment in mining has actually been declining for

many years. Since peaking in 1981, mining has lost about

600,000 jobs. The two increases in 1996 and 1997, then, rather

than the loss in 1998, were exceptional, although the latest

year’s decline was unusually large within the context of the

postrecession nineties.

Construction and related industries. Historically low interest rates and their effects benefited a variety of industries.

Largely because of more affordable mortgages, construction

and related industries added far more jobs than in the years

1993 to 1997. (See table 2 and chart 3.) A decline of 0.4 percentage point brought the 30-year fixed mortgage rate to a

lower level than that of any year since 1970. The value of

construction put in place10 increased much more than in 4 of

the 5 previous years. The strength in construction activity was

primarily in new single-family houses: the value of singlefamily home construction increased in 1998 by $21 billion

(15 percent) in constant 1992 dollars. In contrast, the construction of private nonresidential buildings increased by only

3.6 percent, and public construction actually declined. Singlefamily home building, then, was one of the most positive

forces in the economy. Construction as a whole gained

314,000 jobs, an increase of 5.5 percent.

Construction-related industries in the finance, insurance,

real estate, and retail trade divisions also exceeded their average gains of 1993 to 1997. Mortgage bankers and brokers

more than tripled their average 5-year job gain, achieving a

robust 18.8-percent increase in 1998. Home-related segments

of the insurance division also sharply increased their rate of

job growth. Fire, marine, and casualty insurance added 11,000

jobs after a 5-year period during which the number of jobs

declined. Title insurance gained 13,000 jobs (17.6 percent) in

1998 after adding a total of only 5,000 in the previous 5 years.

Job growth in the real estate industry was about double the

average growth during the previous 5-year period. Two homerelated segments of retail trade—building material and garden supply stores, and furniture and home furnishings stores—

also exceeded their 5-year average job growth. Furthermore,

among the 10 major industry groups in durable manufacturing, only the construction-related groups of furniture and fixtures and stone, clay, and glass products exceeded their average hiring in the previous 5 years.

Finance, insurance, and real estate. Aside from reaping the

benefits of increased home building, the finance, insurance,

and real estate division profited from other effects of lower

interest rates. (See chart 3.) For example, low returns on interest-bearing securities make stocks relatively attractive and
10 Monthly Labor Review February 1999

Employment in 1998

therefore can increase demand for the services of security brokers. Furthermore, some of the same component industries

that benefited from increased home building were also aided

by other effects of low rates. As a case in point, mortgage

bankers and brokers profited from rising existing home sales

and refinancings, both attributable at least in part to low interest rates.

Most of the major subdivisions of finance, including

nondepository institutions, security and commodity brokers,

and holding and other investment offices, added unusually

large numbers of jobs. Security and commodity brokers increased their employment by 49,000 (8.0 percent), almost 11⁄2

times the average gain of the previous 5 years (33,000).

In contrast, employment in depository institutions was little

changed in 1998. Following declines earlier in the postrecession period, the industry had made a small comeback in 1997,

but barely built on that gain in 1998.

The real estate industry benefited from lower interest rates,

not only as they affected construction activity, but also because lower rates encouraged the purchase of existing homes.

Sales of existing homes increased over the year by an unusual

9.9 percent. Real estate added 50,000 new jobs in 1998, nearly

doubling its average increase during the previous 5 years.

The insurance industry added 75,000 jobs in 1998, 51,000

more than it had averaged during the previous 5 years.

Strength in hiring was not only in the construction-related

types of insurance mentioned earlier, but also in life insurance. While whole-life insurance became less popular, variable annuities, which combine insurance protection with stock

mutual funds, became more attractive to baby boomers as they

increased their preparations for retirement.11 Life insurance

carriers added 9,000 jobs in 1998 after

averaging an annual loss of 7,000 jobs

in the previous 5 years.

Government. All levels of government combined added 323,000 jobs in

1998, an increase of about 70 percent

from the 5-year average gain of 1992

to 1997. Federal, State, and local government all contributed to the increased

net hiring. (See table 2.)

After 5 years of reductions that averaged 51,000 per year, Federal employment showed a small gain in 1998.

Much of the change in trend was due

to a smaller reduction in the Department of Defense (–29,000, as opposed

to an average of –44,000 during the

previous 5 years) and the hiring of

about 30,000 employees to work on the

2000 census (although such jobs are

not permanent). The Postal Service

gained 12,000 workers, about the same

number as in the preceding year. Other agencies showed slight

overall net hiring after 5 years of reductions.

Growth in State government employment was strong. The

1998 increase (72,000 jobs, or 1.6 percent) was about double

the previous 5-year average growth. Job growth in State general administration accelerated, and State hospitals had nearly

stable employment after losing jobs in 1995 and 1996. State

education, consisting mainly of higher education, gained

33,000 jobs, exceeding its 5-year average by 10,000. Fall

1998 enrollment was projected to grow by 177,000, the largest increase since 1991.12

Local public education gained a large number of jobs in

1998 (157,000), exceeding its 5-year average by 20,000.

While the Department of Education projects relatively small

gains in public enrollment in kindergarten through 12th grade

in 1997 and 1998,13 the improvement of education was of great

interest to the public and was an important issue in the fall

1998 elections.14 State governments have been responding to

public demands for better schools by increasing aid to school

districts.15 Spending per pupil (including funds from all

sources) in 1997 and 1998 was projected by the Department

of Education to increase much more than in previous

postrecession years.16 Local government hospitals had an unusual increase of 15,000 jobs after losing an average of 5,000

per year in the previous 5 years. Local government as a whole

gained 235,000 jobs in 1998, 26,000 more than the previous

5-year average.

Strong services industries. Despite the slowing of job

growth in the services division as a whole in 1998, certain

categories within services exceeded earlier growth substanTable 4. Change in nonfarm payroll employment, by industry, fourth-quarter

averages, 199398

[Numbers in thousands]

Total nonfarm ........ 3,279 2.7 2,965 2.6 2,886 2.3 126,820

Mining......................... 9 1.5 –6 –1.0 –32 –5.4 560

Construction ............... 222 4.0 251 5.0 314 5.5 6,075

Manufacturing ............. 230 1.2 138 .8 –169 –.9 18,587

Transportation ............ 106 2.6 125 3.3 115 2.8 4,259

Communications......... 76 5.5 37 2.7 53 3.7 1,503

Public utilities ............. –16 –1.8 –18 –2.0 –7 –.8 853

Wholesale trade ......... 165 2.5 151 2.4 161 2.4 6,874

Retail trade ................. 386 1.8 547 2.7 465 2.1 22,650

Finance ...................... 122 3.7 58 1.8 144 4.2 3,608

Insurance ................... 45 2.0 24 1.1 75 3.3 2,357

Real estate ................. 28 2.0 26 1.9 50 3.5 1,476

Services ..................... 1,675 4.8 1,441 4.5 1,394 3.8 38,033

Federal Government ... –41 –1.5 –51 –1.8 16 .6 2,705

State government ....... 27 .6 35 .8 72 1.6 4,683

Local government ....... 245 2.0 209 1.8 235 1.9 12,598

Industry

Change, fourth quarter to fourth quarter

Number of

jobs, fourth

quarter

1998

199697 Average, 199397 199798

Number Percent Number Percent Number Percent
Monthly Labor Review February 1999 11

Chart 4. Difference between 1998 job growth and average job growth from 1992 to 1997, services industries

Agricultural services

Lodging

Personal

Business

Automotive

Miscellaneous repair

Motion pictures

Amusement and recreation

Health

Legal

Private education

Social

Museums

Membership organizations

Engineering and management

-100 -50 0 50 100 150 0

NOTE: Changes are from the fourth quarter to the fourth quarter. Fourth-quarter 1998 data are preliminary.

Thousands of jobs

–100 –50 0

Chart 3. Difference between 1998 job growth and average job growth from 1992 to 1997, by industry division

Mining

Construction

Manufacturing

Transportation and public utilities

Wholesale trade

Retail trade

Finance, insurance, and real estate

Services

Government

-400 -300 -200 -100 0 100 200 0

NOTE: Changes are from the fourth quarter of 1997 to the fourth quarter of 1998. Data are preliminary. The transportation and public 

utilities division includes the communications industry.

Thousands of jobs

––400 –300 –200 –100
12 Monthly Labor Review February 1999

Employment in 1998

tially. In 1998, the computer and dataprocessing services group was strong,

with a gain of 200,000 jobs, about 11⁄2

times its 5-year average. The industry

was among the fastest-growing ones

for the second straight year, increasing its employment by 13.5 percent in

1998, following a 14.6-percent rise in

the previous year. The amusement and

recreation group gained 120,000 jobs

(an increase of 7.5 percent), exceeding its 5-year average by 40,000. Engineering and management services

grew by 7.3 percent, or 227,000 jobs,

about twice the industry’s average gain

during the previous 5 years. Each of

the industry group’s main components

(engineering and architectural services; accounting, auditing, and bookkeeping; research and testing; and

management and public relations) registered a substantial increase in job

growth. Management and public relations payrolls expanded by 11.1 percent, after increasing by an average of

7.9 percent in the previous 5 years. The

management and public relations component includes management consulting, an industry now frequently utilized to help clients adapt to more

technologically advanced communications, data storage and retrieval, and

billing functions, among others.

Steady industry trends. Other industry divisions continued to produce or

lose jobs in numbers similar to those

of previous years. Retailing expanded

by almost half a million jobs (2.1 percent) in 1998, more than the number

gained by any other division except

services. While the 1998 gain in retail

trade was less than the average of the

previous 5 years, the increase was typical of those since 1995. The retail

components eating and drinking

places, general merchandise stores,

and miscellaneous retailing, which includes mail-order companies and sellers marketing their wares over the

Internet, contributed most to the expansion (147,000, 74,000, and 57,000

Characteristic

1998 Change,

fourth

quarter, 1997,

to fourth

quarter, 19981

Fourth

quarter,

1997

First Second Third Fourth

quarter quarter quarter quarter

Table 5. Employment status of the civilian noninstitutional population 16 years and

older, by sex, age, race, and Hispanic origin, quarterly averages,

seasonally adjusted, 199798

Total

Civilian labor force ....................... 136,807 137,337 137,366 137,656 138,285 1,737

Participation rate .................... 67.1 67.2 67.0 67.0 67.1 .1

Employed ................................. 130,413 130,957 131,288 131,419 132,166 2,038

Employment-population ratio . 63.9 64.1 64.1 64.0 64.1 .3

Unemployed ............................. 6,394 6,380 6,079 6,237 6,120 –300

Unemployment rate ................ 4.7 4.6 4.4 4.5 4.4 –.3

Men, 20 years and older

Civilian labor force ....................... 69,388 69,517 69,605 69,708 70,002 714

Participation rate .................... 76.9 76.9 76.8 76.7 76.8 .0

Employed ................................. 66,599 66,863 67,084 67,086 67,496 1,003

Employment-population ratio . 73.8 73.9 74.0 73.8 74.0 .3

Unemployed ............................. 2,789 2,655 2,521 2,622 2,506 –290

Unemployment rate ................ 4.0 3.8 3.6 3.8 3.6 –.4

Women, 20 years and older

Civilian labor force ....................... 59,450 59,625 59,578 59,659 59,933 565

Participation rate .................... 60.5 60.5 60.4 60.3 60.5 .1

Employed ................................. 57,021 57,095 57,181 57,266 57,562 636

Employment-population ratio . 58.1 58.0 58.0 57.9 58.1 .1

Unemployed ............................. 2,429 2,530 2,398 2,393 2,372 –67

Unemployment rate ................ 4.1 4.2 4.0 4.0 4.0 –.1

Both sexes, 16 to 19 years

Civilian labor force ....................... 7,968 8,195 8,183 8,289 8,350 444

Participation rate .................... 51.5 53.0 52.4 52.8 52.8 1.8

Employed ................................. 6,793 7,000 7,023 7,067 7,108 387

Employment-population ratio . 43.9 45.3 45.0 45.0 45.0 1.6

Unemployed ............................. 1,176 1,195 1,160 1,222 1,242 59

Unemployment rate ................ 14.8 14.6 14.2 14.7 14.9 .1

White

Civilian labor force ....................... 114,999 115,227 115,214 115,402 115,799 1,016

Participation rate .................... 67.4 67.4 67.3 67.2 67.3 .0

Employed ................................. 110,449 10,649 110,818 110,915 111,342 1,123

Employment-population ratio . 64.8 64.7 64.7 64.6 64.7 .0

Unemployed ............................. 4,549 4,578 4,395 4,487 4,457 –108

Unemployment rate ................ 4.0 4.0 3.8 3.9 3.8 –.2

Black

Civilian labor force ....................... 15,641 15,845 15,895 16,003 16,174 578

Participation rate .................... 64.8 65.4 65.4 65.5 65.9 1.3

Employed ................................. 14,122 14,364 14,497 14,537 14,821 749

Employment-population ratio . 58.5 59.3 59.6 59.5 60.4 2.1

Unemployed ............................. 1,519 1,481 1,399 1,466 1,352 –173

Unemployment rate ................ 9.7 9.3 8.8 9.2 8.4 –1.4

Hispanic origin

Civilian labor force ....................... 13,961 14,140 14,347 14,347 14,438 477

Participation rate .................... 67.9 68.0 68.4 67.8 67.6 –.3

Employed ................................. 12,929 13,155 13,340 13,299 13,370 441

Employment-population ratio . 62.8 63.3 63.6 62.8 62.6 –.2

Unemployed ............................. 1,032 984 1,007 1,048 1,068 32

Unemployment rate ................ 7.4 7.0 7.0 7.3 7.4 .0

 1 Data for 1998 are not strictly comparable to data shown for 1997 because of the introduction of new

composite estimation procedures and revised population controls in January 1998. (See footnote 17 in text.)

Estimates of over-the-year changes have been adjusted to correct for this break in the series. In some labor

force series, the impact of the new procedures was negligible and required no adjustment.

NOTE: Details for race and Hispanic-origin groups do not sum to totals because data for the “other races”

group are not presented and Hispanics are included in both the white and black population groups.

[Numbers in thousands]
Monthly Labor Review February 1999 13

Chart 5. Unemployment rates, seasonally adjusted, from business cycle trough to 92 or 94 months later

1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93

2

4

6

8

10

12

2

4

6

8

10

12

Number of months after trough

Percent Percent

November 1982 to June 1990

March 1991 to December 1998

Chart 6. Employment growth, by earnings group, January 1996 to December 1998, seasonally adjusted

January 1996 July 1996 January 1997 July 1997 January 1998 July 1998

-4

-2

0

2

4

6

8

10

12

0

-4

-2

0

2

4

6

8

10

12

0

Highest earnings group

Middle earnings group

Lowest earnings group

Percent Percent

NOTE: The percent change shown represents the cumulative percent growth from January 1996 to December 1998.

–

–

–

––2

–4
14 Monthly Labor Review February 1999

Employment in 1998

jobs, respectively). The job growth in eating and drinking

places in 1998, while greater than in 1997 and about the same

as in 1996, was far less than earlier in the nineties (1993

through 1995), when the industry added about a quarter of a

million jobs per year. Various other forms of retailing, including general merchandise stores and the previously mentioned

construction-related components, were relatively strong in

1998, allowing the overall growth of retailing jobs to be similar to growth in the industry in other recent years.

Transportation added 115,000 jobs (2.8 percent); trucking, the component that gained the largest number, contributed 45,000. Public utilities lost 7,000 jobs (–0.8 percent);

utilities have been cutting costs in order to prepare for a deregulated, more competitive environment. The 0.8-percent

loss in 1998, however, was mild in comparison to an average

2.0-percent loss in the previous 5 years. Communications

added 53,000 jobs (3.7 percent), and wholesale trade added

161,000 (2.4 percent); both divisions were slightly stronger

than in the previous 5 years. (See table 4.)

The workers: demographic differences

Total employment growth slowed in 1998, increasing by only

1.6 percent, as measured by the household survey, compared

with a 2.1-percent rate of growth in both 1996 and 1997.17

Despite the slowdown in employment growth, the economy

maintained a very low unemployment rate in 1998. The

monthly rate, which ranged within a narrow band from 4.3

percent to 4.7 percent during 1998, has remained at or below

5.0 percent since April of 1997. (See chart 5.) The last period

Table 6. Changes in employment, 199697 and 199798, and 1996 median usual weekly earnings for selected occupations

and industries

[Numbers in thousands]

Occupation

1996 median

weekly

earnings2

Industry

Number Percent Number Percent

Change in employment

1996971 1997981

 Highest earnings group

Total .................................................. . . . 1,203 2.9 1,315 3.0 (3

)

Professional specialty ............................... Manufacturing 56 3.0 68 3.5 $884

Executive, administrative, and managerial Manufacturing 42 1.5 126 4.4 854

Executive, administrative, and managerial Transportation and public utilities 71 6.1 76 6.2 776

Executive, administrative, and managerial Construction 53 4.3 105 8.3 745

Precision production, craft, and repair ...... Transportation and public utilities 72 6.1 28 2.2 682

Executive, administrative, and managerial Finance, insurance, and real estate 153 6.7 61 2.5 653

Executive, administrative, and managerial Services 295 4.6 152 2.3 624

Professional specialty ............................... Services 365 2.5 413 2.8 619

Middle earnings group

Total .................................................. . . . 1,088 2.6 261 .6 (3

)

Precision production, craft, and repair ...... Manufacturing 73 1.9 69 1.8 549

Precision production, craft, and repair ...... Construction 288 6.5 158 3.3 499

Operators, fabricators, and laborers ......... Transportation and public utilities 147 5.4 7 2 482

Executive, administrative, and managerial Retail trade 75 4.1 23 1.2 475

Technicians and related support ............... Services 178 7.7 51 2.1 474

Precision production, craft, and repair ...... Services 60 2.9 39 1.9 443

Operators, fabricators, and laborers ......... Manufacturing 75 .9 –258 –3.1 381

Lowest earnings group

Total .................................................. . . . 556 1.3 332 .8 (3

)

Administrative support, including clerical .. Services 208 3.0 6 .1 313

Administrative support, including clerical .. Retail trade –97 –6.2 –42 –2.8 289

Sales occupations .................................... Services 90 8.1 –14 –1.1 268

Sales occupations .................................... Retail trade 248 2.7 –3 .0 244

Service occupations ................................. Services 170 1.8 114 1.2 233

Service occupations ................................. Retail trade 66 1.3 76 1.5 187

1Change (number and percent) was calculated from unrounded estimates.

2 Data refer to all wage and salary workers aged 16 years and older.

3 Not available.

NOTE: Details do not sum to totals because only those specific occupation-industry groups that supplied a large proportion of the employment growth

or decline are presented. Employment change was calculated using annual averages for 1996, 1997, and 1998. Beginning in January 1997, data reflect revised population controls used in the household survey. Beginning in January

1998, data reflect new composite estimation procedures and updated population controls used in the household survey. The employment changes do not

reflect these revisions in the survey.
Monthly Labor Review February 1999 15

in which the unemployment rate remained so low for so long was during

the late 1960s. Among the unemployed,

however, long-term unemployment remained relatively high.

Total employed. Total employment,

as estimated from the survey of households, rose by 2.0 million over the year

to a seasonally adjusted level of 132.2

million in the fourth quarter. (See table

5.) The proportion of the civilian noninstitutional population aged 16 and

older who were employed—the employment-to-population ratio—increased over the year to 64.1 percent.

This measure reached a historical high

of 64.2 percent late in 1998.

Over the year, the employment-topopulation ratio of adult men increased

0.3 percentage point to 74.0 percent,

while the corresponding ratio for women

was about unchanged at 58.1 percent.

The ratio for teenagers increased by 1.6

percentage points in 1998 after showing

little movement during 1996 and 1997.

Among the major racial and ethnic

groups, the employment-to-population

ratio for blacks climbed 2.1 percentage

points to 60.4 percent in 1998, while the

rates for whites and Hispanics were little

changed.

Employment among full-time workers (those who usually work 35 or more

hours per week at all jobs combined)

increased over the year by 2.0 million.

The proportion of workers employed

full time has risen steadily with few interruptions since the beginning of 1994,

while part-time employment has declined in the same manner.18 This pattern is typical during economic expansions. In 1998, self-employment as a

percentage of total employment edged

down to 7.7 percent, after also declining slightly in 1997.

Multiple jobholders. On average in 1998, 7.9 million workers were multiple jobholders—that is, they held more than

one job at a time. These workers accounted for 6.0 percent of

the total employed. Adjusted for changes in the composite

estimation procedure, but not seasonally adjusted, both the

level and the percentage of multiple jobholders declined

slightly over the year. (See footnote 17.) As shown in the following tabulation, more than half of all moonlighters in 1998

combined a full-time job with a part-time one, while about 1

in 5 combined two part-time jobs:19

Category

1998 Change,

fourth

quarter, 1997,

to fourth

quarter, 19981

Fourth

quarter,

1997

Less than a high

school diploma

Civilian noninstitutional

population2 ................................. 29,372 29,487 29,878 29,174 28,964 –408

Civilian labor force ................... 12,540 12,569 12,679 12,540 12,457 38

Percent of population ............. 42.7 42.6 42.4 43.0 43.0 .7

Employed ................................. 11,596 11,669 11,788 11,656 11,585 102

Employment-population ratio . 39.5 39.6 39.5 40.0 40.0 .9

Unemployed ............................. 943 900 891 884 872 –71

Unemployment rate ................ 7.5 7.2 7.0 7.0 7.0 –.5

High school graduate,

no college3

Civilian noninstitutional

population2 ................................. 57,467 57,636 57,545 57,564 57,351 –116

Civilian labor force ................... 37,698 37,775 37,357 37,315 37,415 –283

Percent of population ............. 65.6 65.5 64.9 64.8 65.2 –.4

Employed ................................. 36,181 36,245 35,896 35,815 35,959 –222

Employment-population ratio . 63.0 62.9 62.4 62.2 62.7 –.3

Unemployed ............................. 1,517 1,530 1,461 1,500 1,456 –73

Unemployment rate ................ 4.0 4.0 3.9 4.0 3.9 –.1

Less than a

bachelor’s degree4

Civilian noninstitutional

population2 ................................. 42,372 42,186 42,069 41,968 42,819 447

Civilian labor force ................... 31,401 31,421 31,376 31,203 31,625 331

Percent of population ............. 74.1 74.5 74.6 74.3 73.9 .0

Employed ................................. 30,431 30,426 30,463 30,283 30,720 393

Employment-population ratio . 71.8 72.1 72.4 72.2 71.7 .1

Unemployed ............................. 970 994 913 920 906 –64

Unemployment rate ................ 3.1 3.2 2.9 2.9 2.9 –.2

College graduate

Civilian noninstitutional

population2 ................................. 41,752 42,099 42,250 43,470 43,471 1,719

Civilian labor force ................... 33,546 33,758 34,116 34,763 34,724 1,225

Percent of population ............. 80.3 80.2 80.7 80.0 79.9 –.3

Employed ................................. 32,945 33,130 33,529 34,172 34,078 1,189

 Employment-population ratio 78.9 78.7 79.4 78.6 78.4 –.4

Unemployed ............................. 602 627 587 592 645 35

Unemployment rate ................ 1.8 1.9 1.7 1.7 1.9 .1

 1Data for 1998 are not strictly comparable to data shown for 1997 because of the introduction of new

composite estimation procedures and revised population controls in January 1998. (See footnote 17 in text.)

Estimates of over-the-year changes have been adjusted to correct for this break in the series. In some labor

force series, the impact of the new procedures was negligible and required no adjustment.

 2 The population figures are not adjusted for seasonal variation.

3Includes those with a high school diploma or equivalent.

4

Includes those with some college and no degree and those with an associate’s degree.

NOTE: Details for race and Hispanic-origin groups do not sum to totals because data for the “other races”

group are not presented and Hispanics are included in both the white and black population groups.

Table 7. Employment status of the civilian noninstitutional population 25 years and

older, by educational attainment, seasonally adjusted quarterly averages, 199798

[Numbers in thousands]

First Second Third Fourth

quarter quarter quarter quarter
16 Monthly Labor Review February 1999

Employment in 1998

Percent distribution

Total Men Women

Total ................................... 100.0 100.0 100.0

Full-time job and

part-time job ........................ 56.5 62.4 49.9

Two full-time jobs ................. 3.4 4.5 2.1

All part-time jobs ................... 20.6 12.3 30.0

Hours vary on one

or more jobs ......................... 19.0 20.3 17.5

Women were slightly more likely than men to hold more

than one job in 1998, with 6.2 percent of women being multiple jobholders, compared with 5.9 percent of men. Women

also were 21⁄2 times as likely as men to hold two or more parttime jobs.

Occupational employment. Employment within managerial

and professional specialty occupations grew by about 1.6 million workers in 1998, nearly twice the 1997 gain. (The data

were seasonally adjusted quarterly data; see footnote 17.)

Throughout much of the 1980s and 1990s, managerial and

professional specialty occupations accounted for a disproportionately large share of the employment growth. Employment

of operators, fabricators, and laborers showed a moderate decline of 122,000 workers in 1998, reflecting the losses within

the manufacturing industry. (See footnote 17.) Employment remained essentially unchanged in the other major occupational groups in 1998.

Job quality

With earnings used as a relative measure of job quality, a detailed look at a

group of 90 major occupations and industries helps pinpoint the nature of the

slowdown in employment growth.20

Monthly employment growth

among major occupation-industry

pairs (such as professionals in manufacturing), divided into three earnings

groups, are presented in chart 6.21 The

data show the percent change in employment for the highest, middle, and

lowest earning groups, using the January 1996 level as the base.22 From

January 1996 to December 1998, total

employment increased by 7.3 million

to 132.5 million (seasonally adjusted

monthly data). Over this period, job

growth surged by 10.1 percent in the

group with the highest earnings, 2

times the increase recorded for the

middle earnings group and 3 times that of the lowest earnings

group. After declining during the early 1990s, employment in

the middle earnings group finally rose above prerecession levels by mid-1997. Since then, no clear trend has been evident.

A more complete understanding of employment developments that transpired between 1996 and 1998 can be obtained

by looking more closely at the over-the-year changes in annual average employment for specific occupation-industry

groups within the three earnings categories, as presented in

table 6.23 Employment in the highest earnings group, comprising primarily managers and professionals in most industries,

grew at nearly the same rate during 1997 and 1998. The rate

of growth in 1998, however, was much higher than in either of

the other two earnings groups. While job growth in the highest earnings group throughout the 1990s has been concentrated

among managers and professionals in the services industry,

recent increases in the number of managers in manufacturing,

in construction, and in transportation and public utilities also

have contributed to the expansion of this group. (See table 6

and chart 6.)

The rate of growth in the middle earnings group was comparable to that of the highest earnings group in 1997, but began to subside by the summer of 1998. As the turmoil created

by the troubled Asian financial markets escalated and the relative value of the U.S. dollar rose, exports to Asia declined.

Table 8. Unemployed persons, by reasons for, and duration of, unemployment,

quarterly averages, seasonally adjusted, 199798

[Numbers in thousands]

Total 16 years and older.......... 6,394 6,380 6,079 6,237 6,120 –300

Reason for unemployment

Job losers and persons who

completed temporary jobs ... 2,916 2,868 2,787 2,855 2,775 –129

On temporary layoff ........... 916 888 797 926 849 –55

Not on temporary layoff ...... 2,000 1,980 1,990 1,929 1,926 –61

Job leavers ............................ 711 770 715 744 705 –17

Reentrants ............................. 2,214 2,203 2,103 2,119 2,101 –139

New Entrants ......................... 548 535 513 494 538 –10

Duration of unemployment

Less than 5 weeks ................. 2,518 2,637 2,596 2,639 2,638 12

5 to 14 weeks ........................ 1,977 1,959 1,973 1,966 1,906 –42

15 or more weeks .................. 1,914 1,781 1,537 1,629 1,596 –270

15 to 26 weeks ................... 917 827 703 775 746 –136

27 or more weeks .............. 997 954 834 854 850 –134

Median duration, in weeks ..... 7.6 7.1 6.5 6.7 6.4 –.9

Average (mean) duration,

in weeks .............................. 15.9 15.2 14.4 14.1 14.2 –1.7

 1Data for 1998 are not strictly comparable to data shown for 1997 because of the introduction of new

composite estimation procedures and revised population controls in January 1998. (See footnote 17 in text.)

Estimates of over-the-year changes have been adjusted to correct for this break in the series. In some labor

force series, the impact of the new procedures was negligible and required no adjustment.

Reason and duration

1998 Change,

fourth

quarter, 1997,

to fourth,

quarter, 19981

Fourth

quarter,

1997 First Second Third Fourth

quarter quarter quarter quarter
Monthly Labor Review February 1999 17

Subsequently, the U.S. trade gap, bolstered by strong domestic demand for relatively cheaper import goods, widened. It is

reasonable to suspect that these conditions contributed to the

associated decline in the employment of operators, fabricators, and laborers in the domestic manufacturing sector. (See

table 6 and chart 6.)

Job growth in the lowest earnings group also slowed in

1998. From 1990 to 1997, employment in this group grew at

an annual rate of about 1.2 percent; however, in 1998, the rate

of growth slowed to less than 1.0 percent. Those occupationindustry cells for which an employment slowdown or decline

was most notable include clerical occupations in the services

industry and sales occupations in retail trade.

Labor force

In 1998, the labor force grew by 1.7 million, to reach 138.3

million, following sizable increases of 2.3 million and 1.9

million in 1996 and 1997, respectively. (The 1998 change has

been adjusted to account for the composite estimation procedure cited in footnote 17.) The labor force participation rate—

the proportion of the civilian noninstitutional population that

is either employed or unemployed—remained essentially unchanged in 1998. (See table 5.) For the year, the labor force

participation rate averaged 67.1 percent, equaling the previous year’s record high.

With respect to the major demographic groups, the labor

force participation rate for teenagers increased by 1.8 percentage points to 52.8 percent, interrupting a 2-year decline. The

labor force participation rate for blacks increased over the year

by 1.3 percentage points, while the measure for Hispanics

declined slightly, to 67.6 percent, for the year. The participation rate for blacks has increased in the fourth quarter each of

the last 5 years.

Unemployment and underutilization

The unemployment rate for most of the major worker groups

was about unchanged over the year, as were the unemployment rates for persons in nearly all of the major educational

categories. Adult men’s rate fell 0.4 percentage point to 3.6

percent in 1998, and the rate for blacks fell by 1.4 percentage

points to 8.4 percent. (See table 5.) The jobless rate for those

with less than a high school diploma declined over the year,

from 7.5 percent to 7.0 percent. (See table 7.) The rate for

this group has fallen by 2.2 percentage points since 1995,

as a tightening labor market benefited even lower skilled

workers.

Chart 7. Long-term unemployment as a proportion of total unemployment, seasonally adjusted, from business

cycle trough to 92 or 94 months later

1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93

5

10

15

20

25

30

5

10

15

20

25

30

Number of months after trough

Percent Percent

November 1982 to June 1990

March 1991 to December 1998
18 Monthly Labor Review February 1999

Employment in 1998

Reasons and duration. The reasons that the unemployed

cited for their unemployment were essentially the same in 1998

as in 1997. The number of unemployed job losers and persons

who completed temporary jobs remained essentially unchanged in 1998 at 2.8 million, after falling by 294,000 in

1997. (See table 8.) The levels of reentrants and new entrants

to the labor force were 2.1 million and 538,000, respectively,

in 1998, little different from the previous year’s figures. Reentrant unemployment had declined significantly in 1997 as a

share of total unemployment.

Duration of unemployment. The number of persons unemployed for 27 or more weeks decreased by 134,000 in 1998,

to 850,000. (See table 8 and footnote 17.) As mentioned earlier, however, long-term unemployment as a proportion of total unemployment remains unusually high relative to prerecession levels. (See chart 7.) The proportion of persons unemployed for 27 or more weeks trended down over the year,

but remains substantially higher than during a similar period

of the last business cycle.24

Underutilization. The Bureau of Labor Statistics has developed a range of

indicators, called alternative measures

of labor underutilization, that can be

used to supplement the jobless rate as

a measure of the underutilization of

labor resources. Table 9 shows alternative measures U–1 through U–6

over the past year.25

Alternative measures U-4 through

U-6 augment the pool of underutilized

resources beyond what is measured in

the official unemployment rate (U–3).

U–4 adds persons classified as “discouraged” to the number of unemployed persons. Discouraged workers

are those persons who say that they

want a job, were available to work, and

had searched for a job some time in

the previous 12 months, but had

stopped looking for work because they

believed that there were no jobs available for them. The total number of discouraged workers was little changed

over the year, as was U–4. (See tables

9 and 10.)

Alternative indicator U–5 includes

all “marginally attached” workers.

This broader group encompasses the

discouraged workers included in U–4,

as well as those who are not currently

looking for work for reasons other than discouragement, such

as transportation or child-care problems. In 1998, there were

about 1.3 million of these marginally attached workers, down

approximately 100,000 from the previous year. (See table 10.)

However, U–5, like U–4, was down only slightly over the year.

The broadest of the alternative indicators, U–6, adds a

group of the “underemployed” to the calculation. U–6 represents the number of unemployed persons, plus all marginally

attached workers (including discouraged workers), plus all

persons employed part time for economic reasons, as a percent of the labor force plus all marginally attached workers.

People are employed part time—that is, 1 to 34 hours per

week—for various reasons. Some would prefer to work full

time, but, because of poor business conditions, are unable to

do so. This group, often called “persons employed part time

for economic reasons,” totaled about 3.2 million in 1998 (data

not seasonally adjusted). By including these workers, U–6

treats some part-time workers on an equal basis with the unemployed. In 1998, U–6 fell 0.7 percentage point to 7.3 perTable 9. Range of alternative measures of labor underutilization, quarterly

averages, not seasonally adjusted, 199798

[In percent]

U–1 Persons unemployed 15 or

more weeks, as a percent of the

civilian labor force ......................... 1.3 1.4 1.2 1.1 1.1 –0.2

U–2 Job losers and persons who

completed temporary jobs, as a

percent of the civilian labor force .. 2.0 2.5 1.9 1.9 1.9 –.1

U–3 Total unemployed, as a percent

of the civilian labor force (official

unemployment rate) ...................... 4.4 5.1 4.4 4.5 4.1 –.3

U–4 Total unemployed plus

discouraged workers, as a percent

of the civilian labor force plus

discouraged workers .................... 4.6 5.3 4.6 4.7 4.4 –.2

U–5 Total unemployed, plus

discouraged workers, plus all other

marginally attached workers, as a

percent of the civilian labor

force plus all marginally attached

workers ......................................... 5.3 6.1 5.2 5.4 5.0 –.3

U–6 Total unemployed, plus all

marginally attached workers, plus

total employed part time for

economic reasons, as a percent of

the civilian labor force plus all

marginally attached workers ......... 8.0 9.0 7.9 8.0 7.3 –.7

 1Data for 1998 are not strictly comparable to data shown for 1997 because of the introduction of new

composite estimation procedures and revised population controls in January 1998. (See footnote 17 in text.)

Estimates of over-the-year changes have been adjusted to correct for this break in the series. In some labor

force series, the impact of the new procedures was negligible and required no adjustment.

Measure

1998 Change,

fourth

quarter, 1997,

to fourth

quarter, 19981

Fourth

quarter,

1997 First Second Third Fourth

quarter quarter quarter quarter
Monthly Labor Review February 1999 19

cent, in part because the level of those employed part time for

economic reasons declined over the year by about 479,000.

Another indicator that provides insight into tightening labor market conditions over the year is the broad measurement

of persons who are not in the labor force, but who have said

they would like a job. These persons who “want a job now”

include not only discouraged workers and other marginally

attached workers—persons who have shown some labor market attachment by a previous job search—but anybody who

simply expresses a desire for employment. The number of such

persons edged down in 1998 by 129,000, to 4.8 million, after

a larger decline in 1997. (See table 10.)

Regional differences

Employment. Nonfarm payroll employment increased by at least 1.5 percent in all four census regions in 1998;

the most notable increase occurred in

the West (2.8 percent).26 Among the

nine geographic divisions, job growth

ranged from 1.3 percent in the East

North Central to 3.2 percent in the

Mountain States. The South Atlantic

and Pacific divisions also had solid

rates of expansion, 2.7 percent and 2.6

percent, respectively. Considerable

variation was seen within the South,

where the East South Central division’s growth rate was only slightly

more than half that of the other two

divisions. The following tabulation

shows nonfarm payroll employment

growth (in thousands) in 1998:

Table 10. Persons not in labor force, by desire and availability for work, age, and sex, annual averages, 199798

[Numbers in thousands]

Total not in labor force .............. 66,837 67,547 11,343 11,343 18,552 18,732 36,942 37,472 24,454 24,799 42,382 42,748

Want a job now 1 .............................. 4,941 4,812 1,909 1,852 2,241 2,152 791 807 2,034 2,008 2,907 2,803

Searched for work in previous

year 2..................................... 2,084 1,953 875 841 997 912 212 200 917 875 1,168 1,078

Not available to work .............. 669 643 346 332 289 275 34 36 257 250 412 392

Available to work .................... 1,416 1,310 529 509 708 637 178 164 659 624 756 686

Reason not currently looking:

Discouragement over job

prospects 3 ........................ 343 331 107 108 184 170 52 53 200 198 143 133

Reasons other than

discouragement ................. 1,073 979 423 401 524 467 126 111 460 427 613 552

Did not search for work in

previous year ............................. 2,857 2,859 1,034 1,011 1,245 1,240 579 608 1,118 1,134 1,739 1,725

Do not want a job now 1 ................... 61,895 62,735 9,434 9,491 16,311 16,580 36,151 36,664 22,420 22,790 39,475 39,945

Total

Category

Age Sex

16 to 24 years 25 to 54 years 55 years and older Men Women

1997 1998 1997 1998 1997 1998 1997 1998 1997 1998 1997 1998

1 Includes some persons who are not asked if they want a job.

2 Persons who had a job in the previous 12 months must have searched

since being separated from that job.

3 Includes persons who believed that no work was available, those who

could not find work, those who lacked necessary schooling or training, and

those who believed that potential employers would think that they were too

young or too old, or who believed that they were being discriminated against for

other reasons.

NOTE: Beginning in January 1998, data reflect new composite estimation

procedures and revised population controls used in the household survey.

Table 11. Unemployment rates by census region and division, seasonally adjusted

quarterly averages, 199798

[In percent]

Northeast .............................. 5.1 5.0 4.7 4.6 4.5 –0.6

New England ..................... 4.2 3.8 3.6 3.4 3.4 –.8

Middle Atlantic ................... 5.5 5.4 5.1 5.0 5.0 –.5

South ..................................... 4.6 4.4 4.3 4.4 4.3 –.3

South Atlantic .................... 4.3 4.2 4.1 4.0 3.9 –.4

East South Central ............. 5.0 4.5 4.3 4.2 4.3 –.7

West South Central ............ 5.0 4.6 4.7 5.0 4.8 –.2

Midwest ................................. 3.9 3.7 3.5 3.6 3.6 –.3

East North Central ............. 4.2 4.0 3.7 3.9 3.8 –.4

West North Central ............ 3.2 3.1 3.1 3.0 2.9 –.3

West ...................................... 5.3 5.2 5.2 5.3 5.2 –.1

Mountain ............................ 4.1 4.0 4.2 4.2 4.1 .0

Pacific ................................ 5.8 5.7 5.6 5.7 5.7 –.1

NOTE: Data for regions and divisions are based on the sum of model-based State labor force estimates.

Region and division

1998 Change,

fourth

quarter, 1997,

to fourth

quarter, 1998

Fourth

quarter,

1997 First Second Third Fourth

quarter quarter quarter quarter
20 Monthly Labor Review February 1999

Employment in 1998

Region Number Percent

 West ........................... 730.5 2.8

 South ......................... 1,027.7 2.4

 Midwest ..................... 456.7 1.5

 Northeast ................... 348.9 1.5

As in most recent years, services accounted for the greatest

number of new jobs in each region (at least 43 percent) and

geographic division (at least 33 percent). Trade ranked second in all regions and eight divisions. On the other hand, construction had the highest growth rate in all regions and eight

divisions. The national weakness in manufacturing was most

severe in the Northeast and South, while the declines in mining were spread across all regions.

Unemployment. Three regions had moderately lower unemployment rates in 1998 than a year earlier, with the Northeast

registering the largest decline, 0.6 percentage point.27 For the

7th consecutive year, the West had the highest jobless rate,

little changed from the 5.3-percent figure posted a year earlier. The Midwest had the lowest rate, 3.6 percent, as it has

had for the past 9 years. Three regions recorded jobless rates

at or near their lowest levels in 20 years. The exception was

the Northeast, where the lowest rates occurred in 1988 to 1989.

(See table 11.)

Seven geographic divisions (all but the Pacific and Mountain divisions) experienced unemployment rate declines of at

least 0.2 percentage point in 1998; all nine divisions had recorded declines in 1997. The largest decreases were seen in

the New England (–0.8 percentage point) and East South Central (–0.7 point) divisions. The West North Central division

registered the lowest jobless rate (2.9 percent) among all divisions for the 9th straight year, while the Pacific division reported the highest rate (5.7 percent) for the 7th year in a row.

At some point during 1998, six divisions recorded unemployment rates at or near their lowest in 20 years, and more than

half of the States achieved new lows.

Hours of work

After increasing in 4 of the previous 5 years, the average workweek of production or nonsupervisory employees in the private sector declined slightly, by a tenth of an hour, in 1998.

Because of the increase in employment, however, aggregate

(or total) hours worked per week rose 2.0 percent, to 3.02

billion. This increase was the smallest since 1995, because of

the decline in average weekly hours and the moderation in the

growth of jobs. The following tabulation compares the 1998

increase with those of the previous 5 years:

Year Annual percent change

in aggregate weekly hours

1993 .................................. 3.6

1994 .................................. 4.4

1995 .................................. 1.7

1996 .................................. 3.1

1997 .................................. 3.4

Average, 1993 to 1997 ....... 3.2

1998 .................................... 2.0

Pay

Survey of establishments. Average hourly earnings of production or nonsupervisory workers on private payrolls excluding agriculture, adjusted for inflation,28 increased 2.4 percent

in 1998, a gain comparable to the 1997 increase. All other

years in the current expansion produced gains of less than 1

percent.

Real average weekly earnings also increased by a relatively

large amount, 2.1 percent, as opposed to an average of 0.8

percent in the previous 5 years. The inflation-adjusted 1998

increase amounted to $8.81 per week in fourth-quarter 1998

dollars. Table 12 shows the sharp differences between 1998

changes and those of the earlier years.

Household survey. Median weekly earnings of full-time

wage and salary workers rose 4.0 percent (in current dollars,

with data not seasonally adjusted) after a 2.7-percent increase

the previous year. The female-to-male earnings ratio also rose

over the year, to 76.3 percent. Blacks and Hispanics increased

their earnings 6.5 and 5.4 percent, respectively, over the year.

(see table 13.)

Median weekly earnings rose for all educational attainment

groups over the year. Median earnings for both high school

graduates and college graduates aged 25 years and older who

worked full time increased over the year by 3.9 percent and

5.4 percent, respectively. Since 1994, median weekly earnings for high school graduates have risen 11.9 percent, outpacing earnings for college graduates, which increased by 10.3

percent.

Table 12. Changes in hours of work, inflation, and pay,

199398

1993 .............. 0.6 2.6 0.0 0.5

1994 .............. .3 2.7 .0 .3

1995 .............. –.9 2.6 .4 –.5

1996 .............. .3 3.2 .4 .9

1997 .............. .6 1.7 2.3 2.6

1993 to 1997 ... .2 2.6 .6 .8

1998 ................ –.3 1.4 2.4 2.1

SOURCES: Hours and earnings, CES program, Bureau of Labor Statistics;

CPI-W, Office of Prices, Bureau of Labor Statistics.

CPI-W

Annual percent change,

fourth quarter to fourth quarter

Year

Average

weekly

hours

Average weekly

earnings in

constant 1982

dollars

Average hourly

earnings in

constant 1982

dollars
Monthly Labor Review February 1999 21

THE YEAR 1998 WAS CHARACTERIZED by contrasts in the labor

market. The overall pace of growth in payroll employment

slowed slightly, in part because of the negative influences on

employment brought about by the Asian economic crises. The

manufacturing division lost jobs after 5 years of at least slight

gains. Certain health care industries lost jobs as medicare policies were changed. Help supply firms added far fewer jobs

than in the recent past, and low oil prices reduced the number

of jobs in petroleum extraction. The length of the average

workweek also diminished slightly.

Many positive developments can be attributed in part to

favorable interest rates, as employment increased strongly in

financial industries, insurance, construction, and real estate.

Other positive developments included strength in hiring in

public-sector education, a slight net rise in hiring in the Federal Government instead of a net reduction, and, for the second straight year, a relatively large increase in average pay,

adjusted for inflation. The strengths and weaknesses combined to produce a total rate of growth in payroll jobs slightly

below the average rate of the previous 5 years of expansion.

Table 13. Quartiles and selected deciles of usual weekly earnings of full-time wage and salary workers, by selected

characteristics, annual averages, 199798

Sex, race, and Hispanic origin

Total, 16 years and older.............. $242 $256 $329 $347 $503 $523 $760 $789 $1,109 $1,155

Men ................................................. 265 279 372 388 579 598 858 895 1,228 1,289

Women ............................................ 225 236 299 312 431 456 636 662 907 943

White ............................................... 249 262 342 359 519 545 783 818 1,139 1,180

Men ............................................... 273 284 386 401 595 615 884 921 1,256 1,338

Women .......................................... 229 240 305 318 444 468 652 675 926 959

Black ................................................ 214 231 284 301 400 426 595 626 824 886

Men ............................................... 228 245 300 317 432 468 635 681 892 950

Women .......................................... 204 222 269 288 375 400 537 589 761 808

Hispanic ........................................... 201 216 258 272 351 370 528 563 798 818

Men ............................................... 209 228 270 284 371 390 571 594 851 887

Women .......................................... 190 199 238 253 318 337 483 507 698 717

Educational attainment

Total, 25 years and older ........................ 260 275 360 379 540 572 801 836 1,149 1,198

Less than a high school diploma ........ 195 204 246 257 321 337 463 486 640 679

High school graduate, no college ........ 245 259 322 338 461 479 646 667 876 899

Some college or associate’s degree ... 280 291 378 391 535 558 754 774 1,008 1,040

College graduate ................................ 388 410 556 586 779 821 1,136 1,173 1,565 1,657

Bachelor’s degree only .................... 364 388 508 541 725 753 1,026 1,097 1,430 1,521

Advanced degree ............................. 470 493 655 675 927 956 1,321 1,368 1,880 1,906

Men, 25 years and older ......................... 288 299 408 425 615 639 904 940 1,273 1,353

Less than a high school diploma ........ 210 225 272 283 365 383 511 535 705 740

High school graduate, no college ........ 284 293 383 394 535 559 739 761 974 1,000

Some college or associate’s degree ... 309 324 435 457 621 643 861 888 1,140 1,162

College graduate ................................ 427 452 618 643 896 939 1,274 1,353 1,800 1,895

Bachelor’s degree only .................... 403 425 586 604 827 871 1,167 1,244 1,589 1,750

Advanced degree ............................. 502 526 733 752 1,047 1,107 1,464 1,539 2,029 2,155

Women, 25 years and older .................... 235 249 315 331 462 485 666 695 938 974

Less than a high school diploma ........ 180 184 215 228 275 283 352 370 466 493

High school graduate, no college ........ 218 232 284 297 378 396 512 532 681 698

Some college or associate’s degree ... 255 271 333 345 459 476 622 642 820 857

College graduate ................................ 355 383 493 522 672 707 934 967 1,246 1,322

Bachelor’s degree only .................... 330 360 459 488 620 653 857 891 1,153 1,198

Advanced degree ............................. 438 464 600 618 800 837 1,073 1,133 1,469 1,521

Characteristic

Upper limit of

Second quartile

(median)1 First decile First quartile

1997 1998 1997 1998 1997 19982 1997 1998 1997 1998

Third quartile Ninth decile

1

The median (or upper limit of the second quartile) is the amount that divides

a given earnings distribution into two equal groups, one having earnings above

the median and the other having earnings equal to or below the median.

Ten percent of the population of a given distribution have earnings below the

upper limit of the first decile (90 percent have higher earnings); 25 percent have

earnings below the upper limit of the first quartile (75 percent have higher earnings); 75 percent have earnings below the upper limit of the third quartile (25

percent have higher earnings); and 90 percent have earnings below the upper

limit of the ninth decile (10 percent have higher earnings).

 2Beginning in January 1998, data reflect new composite estimation procedures and revised population controls used in the household survey.
22 Monthly Labor Review February 1999

Employment in 1998

Footnotes

ACKNOWLEDGMENTS: Some of the material on employment and unemployment in the various regions of the United States was written by Roberto

Morales, a BLS economist in the Division of Local Area Unemployment Statistics. Randy Ilg, a BLS economist in the Division of Labor Force Statistics,

contributed the material on job quality.

1 Unless otherwise noted, the data presented are seasonally adjusted quarterly averages. The changes representing movements in 1998 generally are

from the fourth quarter of 1997 to the fourth quarter of 1998. CES data for the

fourth quarter of 1998 are preliminary.

2 Freddie Mac’s records begin in 1971. Comparable earlier records are

not available.

3 Data representing employment by industry, hours of work, and average

pay of production or nonsupervisory workers are from the Bureau’s Current

Employment Statistics program, which conducts a monthly survey of nearly

400,000 offices, stores, factories, construction sites, and all other types of

workplaces except farms, households, and forestry, fishing, hunting, or trapping sites. The sample includes more than a third (36 percent) of the corresponding universe of employment.

4 Based on data for 1993, a year with moderate export activity.

5 See Jim Ostroff, “Textile/Apparel Imports Continue to Pour in from

Asia,” Daily News Record, Aug. 19, 1998; Paula L. Green, “Textile, apparel

imports continue to increase,” Journal of Commerce, Sept. 23, 1998; and

Jim Ostroff, “Yet Again, Textiles Imports Soar,” HFN: The Weekly Newspaper for the Home Furnishing Network, Aug. 3, 1998.

6 The information that follows is compiled from the website of the Health

Care Finance Administration, U.S. Department of Health and Human Services (http://www.HCFA.gov).

7 “Surveys Find More Employers Relying on Staffing Firms,” SI Review,

September/October 1998, p. 42. See also, for example, Chris Olson, “Firms

Peg Labor Shortage as Top Woe,” Omaha World-Herald, Nov. 13, 1998.

The latter article typifies newspaper accounts on the subject.

8 The producer price index for domestic crude petroleum is from the

Office of Prices and Living Conditions of the Bureau of Labor Statistics.

9 Lois Romano, “World’s Oil Glut Is Fueling Perilous Times in Oklahoma,” The Washington Post, Jan. 19, 1999, p. A3.

10 The value of construction put in place, estimated by the Bureau of the

Census, “is a measure of the value of construction installed or erected at . . .

[a] site during a given period,” including the cost of materials installed or

erected, the cost of labor, profit, and other costs. (See Value of Construction

Put in Place (Bureau of the Census, May 1998), Appendix A; quote from p.

A1.)

11 Joseph B. Treaster, “Life insurance sales fall as U.S. society changes,”

Denver Post, Sept. 10, 1998. See also Michael Nol, “Variable-annuity boom

spurred AIG bid // Retirement: The investments are the fastest-growing segment of the life insurance business,” The Orange County Register, Aug. 21,

1998.

12 Digest of Education Statistics 1997 (U.S. Department of Education,

1998), table 2. 13 Projections of Education Statistics to 2008 (National Center for Education Statistics, 1998), table 2. Enrollments for 1997 and 1998 are

projected.

14 Robert C. Johnston, “Will the Real Education Candidate Please Stand

Up?” Education Week, Oct. 21, 1998, pp. 26–31. 15 See William Booth, “Californians’ Favorite Subject: A School’s Overhaul,” The Washington Post, Nov. 24, 1998, pp. A1, A4; and Johnston, “Real

Education Candidate,” p. 31. 16 Projections of Education Statistics, table 34.

17 The Current Population Survey (CPS), a nationwide sample survey conducted for the Bureau of Labor Statistics by the Bureau of the Census, provides information about the demographic characteristics and employment

status of the noninstitutional population aged 16 and older. The estimates of

employment and over-the-year employment growth from the CPS differ from

those obtained from the CES survey because of conceptual and methodological differences between the two surveys. (For an overview of these differenCES, see box on p. 4.)

Unless otherwise noted, “over-the-year change” refers to the change from

the fourth quarter of 1997 to the fourth quarter of 1998.

Beginning in January 1998, data are not strictly comparable with data for

1997 and earlier years because of the introduction of new composite estimation procedures and the revision of the population controls used in the household survey. Where applicable, estimates of over-the-year change have been

adjusted to account for the break in the series. For additional information,

see “Revisions in the Current Population Survey Effective January 1998” in

the February 1998 issue of Employment and Earnings.

18 Direct comparisons prior to January 1994 are not recommended, because changes to the questionnaire resulted in an increase in the estimated

number of people working part time.

19 Percentages will not sum to 100, because of the exclusion of persons

who work part time on their primary job and full time on their secondary

job(s), whose percentages are not shown separately.

20 Individual cells of a matrix depicting major occupation by major industry were ranked in descending order by median weekly earnings of all

wage and salary workers in 1996. These cells were then grouped into three

categories—highest, middle, and lowest earnings—that each accounted for

approximately one-third of total employment in 1996. An employment time

series for each occupation-industry cell from January 1996 to December

1998 was developed, and data for each cell were sorted into the appropriate

earnings group. For a more detailed explanation of the nature of job growth

and a complete discussion of the methodology used in the analysis, see Randy

E. Ilg, “The nature of employment growth, 1989–95,” Monthly Labor Review, June 1996, pp. 29–36.

21 Beginning in January 1997, data reflect revised population controls

used in the household survey; beginning in January 1998, data reflect the

new composite estimation procedure. Data were not adjusted, because the

magnitudes of these changes were nearly offsetting and there were no adjustments available for the separate series.

22 The monthly time-series data that were used were independently seasonally adjusted and do not sum to the total-employment figures.

23 Only those specific occupation-industry groups that supplied a large

proportion of the employment growth or decline are presented. For a complete list of the occupation-industry cells, see Ilg, “Nature of employment

growth.” Data used in the analysis presented in the current article are annual

As measured by the household survey, employment grew in

1998, but not by as much as in 1997. Most of the 1998 growth

occurred within managerial and professional specialty occupations. The unemployment rate remained unusually low by

historical standards, reaching 4.3 percent in April and December. The labor force participation rate matched 1997’s record

high, while the employment-to-population ratio exceeded its

previous high set that same year. With respect to the major

demographic groups, the employment-to-population ratio

for blacks rose in 1998, as their labor force participation

rate continued to increase over the year.

Because of the tightening labor market, the unemployment rate for those with less than a high school education

declined and the earnings of this group, although lower than

the earnings of those with more education, rose 5 percent

over the year.
Monthly Labor Review February 1999 23

averages that have been ranked according to earnings of all wage and salary

workers in 1996 and divided into equal employment groups on the basis of

1996 total employment. Therefore, because of the new ranking order, a certain number of specific occupation-industry cells may now be included in

earnings groups other than those in which they originally appeared in the

1996 published research. The source of both the annual average employment data and the earnings data used in this analysis is the Current Population Survey.

24 As of October 1998, the current business expansion reached 92 months

of uninterrupted growth, equaling the previous longest peacetime expansion that began in November 1982 and ended in June 1990, according to the

Bureau of Economic Research.

25 For additional information, see John E. Bregger and Steven E. Haugen,

“BLS introduces new range of alternative unemployment measures,” Monthly

Labor Review, October 1995, pp. 19–26. Two of the alternative measures,

U–1 and U–2, are excluded from our analysis because they focus on the

duration of unemployment and reasons for unemployment, which have just

been discussed. 26 Both the nonfarm employment estimates and the labor force estimates

are the sum of State estimates and are not intended to add up to national

totals.

27 Labor force estimates for census regions and divisions were converted

to sums of State model-based estimates beginning with January 1998 data. 28 The CPI-W is used for the adjustment.

Bureau of Labor Statistics Internet

The Bureau of Labor Statistics World Wide Web site on the Internet contains a range

of data on consumer and producer prices, employment and unemployment, occupational compensation, employee benefits, workplace injuries and illnesses, and productivity. The homepage, at

http://stats.bls.gov

can be accessed using any Web browser. Also, some data can be accessed through

anonymous FTP or Gopher at

stats.bls.gov