Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, May 6, 1995 TAG: 9505080063
SECTION: BUSINESS PAGE: A-6 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
The Clinton administration and private analysts said the deteriorating labor picture was cause for concern, although few predicted the economy was headed for a tailspin.
The Labor Department reported Friday that the nation's jobless rate jumped from 5.5 percent in March to 5.8 percent last month, pushing unemployment back to where it was in September.
The number of new jobs fell 9,000, the first decline since a 52,000 decrease in March 1993.
Analysts said statistical quirks contributed to the deterioration, but added there is no doubt a slowing economy is threatening to put more people out of work.
``The Federal Reserve should immediately reduce interest rates by at least one-half percent to counter the growing rise of stagnation, or worse, another recession,'' said Lawrence Chimerine of the Economic Strategy Institute, a think tank.
Others said there is little cause for alarm.
``The report shows the economy is slowing. It's premature to talk about a recession,'' said Carl Palash of MCM Moneywatch, a New York City forecasting service.
``The job market is cooling off considerably,'' said economist Norman Robertson of Carnegie Mellon University in Pittsburgh. ``Unfortunately, a soft landing in an economy of this size and complexity is not an easy task to accomplish.''
The April labor picture was muddied by special factors. There had been unusual job gains in March because of unusually mild weather, making April's job growth appear weaker than normal.
Also, the Labor Department measured employment over a four-week period last month, instead of a five-week interval that has applied in the past three Aprils. And a supermarket strike in Northern California took about 25,000 workers off the rolls.
``I'm concerned but not distraught,'' said Labor Secretary Robert Reich. ``If you're an unemployed worker or tottering on the brink, this is bad news. We cannot be complacent about it.''
The Labor Department also said job growth in March was less robust than an earlier estimate. It revised its figure to show 177,000 new jobs were created instead of 203,000.
The average work week increased to 34.6 hours from 34.5 hours in March.
Manufacturing employment, which had been climbing steadily since the fall of 1993, has leveled off and begun falling. There were 28,000 fewer factory jobs in April and 11,000 fewer in March.
The construction industry subtracted 20,000 jobs last month after adding 68,000 during the mild March.
Service-related industries produced 42,000 new jobs. Federal, state and local government jobs rose 1,000.
by CNB