FOR DELIVERY: 9:30 A.M., E.S.T.
                            FRIDAY, FEBRUARY 7, 1997


Advance copies of this statement are made available to the
press under lock-up conditions with the explicit
understanding that the data are embargoed until 8:30 a.m.
Eastern Standard Time.

Statement of

Katharine G. Abraham
Commissioner
Bureau of Labor Statistics

before the

Joint Economic Committee

UNITED STATES CONGRESS

Friday, February 7, 1997




Mr. Chairman and Members of the Committee:

I would like to thank you for this opportunity to
comment on the labor market data released this morning.
The unemployment rate was essentially unchanged in
January at 5.4 percent.  Nonfarm payroll employment
increased by 271,000 over the month.  A number of roughly
offsetting special factors influenced the payroll
employment estimate.  Heavy snows (and resulting employment
declines) in January 1996 affected our seasonal adjustment
factors for this year, leading to an exaggeration of the
over-the-month employment growth in certain industries.  On
the other hand, employment was dampened in some sectors by
bad weather this January, as well as by unusual movements
in employment in several industries around the holiday
season.  The net effect of all of these special factors on
aggregate payroll employment growth was small, although
estimates for specific industries may be somewhat over- or
understated.
The services industry added 167,000 jobs in January.
This compares with an average monthly increase of 85,000
between May and December.  The January gain was boosted by
an unusually large estimated increase (82,000) in help
supply services.  Although there does appear to have been
some genuine strength in this industry in January, the
magnitude of the over-the-month employment increase was
somewhat exaggerated by the special factors that I
mentioned earlier.  Elsewhere in services, health services
added 43,000 jobs in January, nearly double the average
monthly gain in 1996.  Strong employment growth trends
continued in January in computer and data processing
services and in engineering and management services.
Employment in the transportation industry increased by
16,000 in January.  The finance and real estate industries
continued their growth pattern, while employment in
insurance fell.  Retail trade employment rose by 19,000 in
January; this industry added an average of 50,000 jobs per
month in 1996.  The January weakness reflected a decline in
employment of 29,000 in general merchandise stores,
following a larger-than-usual holiday employment buildup.
In the goods-producing sector, manufacturing added
18,000 jobs in January and has gained 53,000 over the past
4 months.  This growth follows declines totaling 319,000
factory jobs from March 1995 through September 1996.
Within manufacturing, industrial machinery and equipment
added 7,000 jobs in January, and motor vehicles added 6,000
jobs.  Aircraft manufacturing continued its recent growth
trend, and apparel its long-term downward trend.
Construction employment continued to increase,
although January’s gain was held down by frigid
temperatures throughout much of the country, and by ice and
snow storms in the South, Midwest, and Northern Plains.
Average hourly earnings of production or
nonsupervisory workers in the private sector edged up 1
cent in January to $12.06.  This follows gains totaling 15
cents per hour in the previous 2 months.  Over the year,
average hourly earnings rose by 44 cents, or 3.8 percent.
Average weekly hours fell by 0.7 hour to 34.1 in
January, reflecting unusually harsh weather conditions.
The decline was spread throughout every major industry,
with an especially large dropoff of 1.0 hour in
construction.
Turning now to our survey of households, the
unemployment rate was essentially unchanged in January at
5.4 percent, and unemployment rates for the major
demographic groups showed little or no change.  Civilian
employment increased by about 430,000 (after adjusting for
the revision to the population estimate that I will
describe in a moment).  The employment-population ratio
edged up to 63.6 percent.
The January household survey data incorporate revised
estimates of the civilian, noninstitutional population age
16 and over.  These revisions primarily reflect improved
information on the demographic characteristics of
immigrants to, and emigrants from, the United States.  The
effect of these revisions is to make the January estimate
of the population age 16 and over approximately 470,000
larger than it otherwise would have been, with the increase
concentrated in the population estimate for Hispanics.  The
revision also raised estimated levels for the labor force,
employment, and unemployment.  The unemployment rate,
employment-population ratio, and other percentages
generally were not affected by the revision.
In summary, nonfarm payroll employment continued to
expand in January, and unemployment was essentially
unchanged.
My colleagues and I now would be glad to answer your
questions.

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