Employment Situation

Highlights for August

• The unemployment rate fell slightly in August to 5.7 percent from 5.9 percent in July, although the change was too small for the Bureau of Labor Statistics to consider it an improvement. Overall, the growth that did occur was driven by increased government employment, not expansion of the private sector.

• Within the private sector, there were some bright spots, such as help services and health services, that partially off-set large losses in manufacturing and retail employment. Although the story of job losses in manufacturing is not new, the severity of the contraction merits continued attention. August marks the 25th month of employment decline in this sector, which now employs 2.2 million fewer workers than it did in April 1998.

• Eventually the labor market will recover but that won’t mean complete relief for workers. Data from the Bureau of Labor Statistics shows that permanent layoffs became more common between 1999 and 2001. Over those three years, 7.0 percent of people in the workforce lost their jobs. This reaffirms that layoffs and downsizing are not just features of recessions but are a regular part of business practice. Not surprisingly, manufacturing workers accounted for one-third of all long-tenured displaced workers.

Civilian Unemployment Rate

Selected unemployment rates
(seasonally adjusted)

	Aug 2001	June 2002	July 2002	Aug 2002
All Civilian Workers	4.9%	5.9%	5.9%	5.7%
Adult Men	4.4	5.4	5.2	5.2
Adult Women	4.2	5.1	5.2	4.9
Teenagers	15.8	17.6	17.7	17.2
Whites	4.3	5.2	5.3	5.1
African-Americans	9.0	10.7	9.9	9.6
Latinos	6.4	7.4	7.6	7.5
Manufacturing Workers	5.7	6.8	6.3	6.3
Service Workers	4.9	5.9	5.8	5.4