FOR DELIVERY: 9:30 A.M., E.S.T.
                         FRIDAY, NOVEMBER 2, 2001

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

                          Lois Orr
                     Acting Commissioner
                 Bureau of Labor Statistics

                         before the

                  Joint Economic Committee

                     TED STATES CONGRESS

                  Friday, November 2, 2001




Mr. Chairman and Members of the Committee:



     Thank you for the opportunity to comment on the October
labor market data we released this morning.

     Payroll employment dropped sharply over the month in
most industries.  The unemployment rate climbed to 5.4
percent in October, the highest rate in nearly 5 years.
These changes include the impact of the events of September
11.  The attacks' impact, however, cannot be separated from
other influences on the job market.

     The decline in total nonfarm payroll employment was
415,000 in October, an unusually large single-month drop.
This followed a sizable decline of 213,000 in September.
Since its recent peak in March, nonfarm employment has
fallen by nearly 900,000.  Private sector job losses have
been even greater—1.2 million over the same period.

     In October, nearly every industry division had a
substantial decline in employment.  Job losses in
manufacturing continued to be heavy and widespread,
totalling 142,000 in October.  Although factory employment
has been in decline for some time, since March alone it has
fallen by more than 800,000.

     In services, employment fell by 111,000 in October, the
fourth (and largest) decline this year in an industry that
had had only one other monthly decline since May 1991.
Particularly large job losses occurred in the help supply
industry and in hotels.

     In the transportation industry, air transportation and
transportation services (largely travel agencies) employment
dropped by 42,000 and 11,000, respectively.  As with hotels,
these large declines were undoubtedly related to cutbacks in
travel since September 11.

     Retail trade posted its second large job loss in a row,
as weakness continued in eating and drinking places.  In
addition, some other areas of retail that normally would
begin holiday hiring in October failed to add jobs at usual
levels.  These include apparel stores and miscellaneous
retailers, such as toy stores and gift shops.

     Elsewhere, employment in construction and in wholesale
trade also fell over the month.  In contrast, a few
industries added jobs in October, including health services,
private education, mortgage banking, and guard services.

     Turning now to data from our household survey, the
unemployment rate rose by half a percentage point in October
to 5.4 percent, the highest jobless rate since late 1996.
The number of unemployed grew by more than 700,000 in
October.  Most of the over-the-month increase in
unemployment reflected persons who had lost jobs, as opposed
to those who had left jobs voluntarily or had been out of
the labor force.  Weak labor market conditions were
pervasive, but increases in jobless rates were particularly
severe for blue-collar workers.  The unemployment rates for
adult men, adult women, whites, blacks, and Hispanics all
increased in October.

     Civilian employment fell by about 600,000 and the
proportion of the population with a job in October declined
to 63.3 percent.  The number of part-time workers who would
have preferred to work full time increased sharply for the
second consecutive month, rising from 3.3 million in August
to 4.5 million in October.  The 2-month increase was
concentrated among workers whose hours were reduced because
of slack work or unfavorable business conditions.

     In summary, employment in almost all major nonfarm
industry groups fell in October; the total job loss was
415,000.  The unemployment rate rose by one-half percentage
point to 5.4 percent, the highest rate in nearly 5 years.



     My colleagues and I now would be glad to answer your
questions.

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