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                        Statement of

                    Katharine G. Abraham
                        Commissioner
                 Bureau of Labor Statistics

                    Friday, July 6, 2001



     Total nonfarm payroll employment fell by 114,000 in
June, the second substantial employment decline in 3 months.
Job losses continued in manufacturing and several related
industries.  The unemployment rate was little changed at 4.5
percent, five-tenths of a percentage point higher than the
average for 2000.

     In June, job losses in manufacturing continued to be
steep (totaling 113,000) and widespread.  Factory employment
has fallen by 347,000 over the past 3 months and by 785,000
since last July.  The largest employment declines over the
month continued to be in electrical equipment (-31,000) and
industrial machinery (-22,000).  Other sizable declines
occurred in furniture, primary metals, fabricated metals,
textiles, apparel, paper, printing and publishing, and rubber
and miscellaneous plastics.  The factory workweek edged down
in June by 0.1 hour to 40.7 hours, while factory overtime
edged up 0.1 hour to 4.0 hours.

     The weakness in manufacturing was felt in several
related industries.  Wholesale trade lost 15,000 jobs, with
cutbacks in both durable and nondurable goods distribution.
Similarly, the number of transportation jobs fell by 12,000,
in part reflecting cutbacks in both air and ground shipments.

     In construction, a strong first quarter likely absorbed
some of the hiring that normally takes place in the spring.
As a result, construction employment was down 50,000 in the
second quarter on a seasonally adjusted basis, including a
small drop in June.

     Services employment was flat in June and, for the first
time in more than 4 decades, the industry failed to add jobs
over the quarter.  Help supply services employment fell in
June for the ninth consecutive month; during that time the
industry has lost a total of 379,000 jobs.  Other services
industries that lost jobs in June included miscellaneous
business services (which includes telemarketing and
convention arranging), hotels and motels (which includes
campgrounds and RV parks), and amusement and recreation
services.  Services did provide a few bright spots in this
month’s report.  Health services continued its strong growth
trend, while engineering and management services and computer
services picked up their pace of job growth.  Retail trade
and state and local government also continued to add jobs.

     Turning to some of the measures obtained from the survey
of households, the unemployment rate was little changed in
June at 4.5 percent.  The unemployment rate for the second
quarter of the year also was 4.5 percent, somewhat higher
than the rate for the first quarter (4.2 percent), which in
turn was slightly higher than the rate for all of 2000 (4.0
percent).

     The employment-population ratio--the share of the 16-and-
over population that holds jobs--continued its gradual
decline, having fallen by 1.1 percentage points from its peak
in April 2000 to 63.7 percent in June 2001.  The number of
part-time workers who would prefer full-time work rose to 3.6
million, an increase of nearly half a million over the last 3
months.

     In conclusion, the job market continued to deteriorate
in June.  Factory employment again fell sharply, and the
weakness in manufacturing likely dampened employment in
transportation, wholesale trade, and help supply.  Cutbacks
in business and vacation travel contributed to employment
declines in hotels, amusements and recreation, and air
transportation.  The June unemployment rate of 4.5 percent
was relatively low by historical standards, but still half a
percentage point higher than the average rate for 2000.

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