[Joint House and Senate Hearing, 109 Congress]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-237
 
                 THE EMPLOYMENT SITUATION: OCTOBER 2005

=======================================================================

                                HEARING

                               before the

                        JOINT ECONOMIC COMMITTEE
                     CONGRESS OF THE UNITED STATES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                            NOVEMBER 4, 2005

                               __________

          Printed for the use of the Joint Economic Committee




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                        JOINT ECONOMIC COMMITTEE

    [Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress]

HOUSE OF REPRESENTATIVES             SENATE
Jim Saxton, New Jersey, Chairman     Robert F. Bennett, Utah, Vice 
Paul Ryan, Wisconsin                     Chairman
Phil English, Pennsylvania           Sam Brownback, Kansas
Ron Paul, Texas                      John E. Sununu, New Hampshire
Kevin Brady, Texas                   Jim DeMint, South Carolina
Thaddeus G. McCotter, Michigan       Jeff Sessions, Alabama
Carolyn B. Maloney, New York         John Cornyn, Texas
Maurice D. Hinchey, New York         Jack Reed, Rhode Island
Loretta Sanchez, California          Edward M. Kennedy, Massachusetts
Elijah E. Cummings, Maryland         Paul S. Sarbanes, Maryland
                                     Jeff Bingaman, New Mexico

               Christopher J. Frenze, Executive Director
                  Chad Stone, Minority Staff Director


                            C O N T E N T S

                              ----------                              

                      Opening Statement of Members

Hon. Jim Saxton, Chairman, a U.S. Representative from the State 
  of New Jersey..................................................     1
Hon. Jack Reed, Ranking Minority Member, a U.S. Senator from the 
  State of Rhode Island..........................................     2

                               Witnesses

Statement of Hon. Kathleen P. Utgoff, Commissioner, Bureau of 
  Labor Statistics; accompanied by John S. Greenlees, Associate 
  Commissioner, Offices of Prices and Living Conditions and John 
  M. Galvin, Associate Commissioner, Employment and Unemployment 
  Statistics.....................................................     3

                       Submissions for the Record

Prepared statement of Representative Jim Saxton..................    15
Prepared statement of Senator Jack Reed, Ranking Minority Member.    16
Prepared statement of Commissioner Kathleen P. Utgoff, together 
  with Press Release No. 05-2118, entitled, ``The Employment 
  Situation: October 2005,'' Bureau of Labor Statistics, 
  Department of Labor............................................    17
Response of Commissioner Kathleen P. Utgoff to question of 
  studies on earnings on women and men...........................    47


                       THE EMPLOYMENT SITUATION: 
                              OCTOBER 2005

                              ----------                              


                        FRIDAY, NOVEMBER 4, 2005

             Congress of the United States,
                          Joint Economic Committee,
                                                     Washington, DC
    The Committee met, pursuant to call, at 9:30 a.m., in room 
2226, Rayburn House Office Building, the Honorable Jim Saxton, 
Chairman of the Committee, presiding.
    Representatives present: Representatives Saxton, McCotter, 
and Maloney.
    Senator present. Senator Reed.
    Staff present: Chris Frenze, Robert Keleher, Colleen Healy, 
John Kachtik, Brian Higginbotham, Emily Gigena, Chad Stone, 
Matt Salomon, and Daphne Clones.

        OPENING STATEMENT OF HON. JIM SAXTON, CHAIRMAN, 
             A U.S. REPRESENTATIVE FROM NEW JERSEY

    Representative Saxton. Good morning. It is a pleasure to 
welcome Commissioner Utgoff before the Committee once again to 
testify on the employment situation.
    The employment figures released today may reflect the 
indirect affects of the recent hurricanes. Payroll employment 
increased by 56,000 in October to a total level of 134.1 
million workers. According to the separate household survey, 
the unemployment rate edged down to 5.0 percent, a decrease of 
one tenth of a percentage point.
    Other standard economic indicators reflect the health of 
the U.S. economy. Figures released last week indicate that the 
economy grew at a 3.8 percent rate in the last quarter of this 
year, despite the massive regional destruction wrought by the 
hurricanes.
    So far in 2005, the economy has expanded at a 3.6 percent 
rate, roughly in line with the Federal Reserve expectations as 
well as the Blue Chip Consensus indicators. Equipment and 
software investment, which has bolstered the economy since 
2003, continues at a healthy pace. This component of investment 
responded especially sharply to the incentives contained in the 
2003 tax legislation.
    Employment has also gained over the period, with 4.2 
million jobs added to business payrolls since May of 2003. The 
unemployment rate, as I said a minute ago, is at 5 percent. 
Consumer spending continues to grow. Home ownership has reached 
record highs. Household net worth is also at record levels. 
Productivity growth continues at a high pace, although higher 
energy prices have raised business costs and imposed hardship 
on many consumers. These energy prices have not derailed the 
expansion.
    In summary, the economy has displayed impressive 
flexibility and resilience in absorbing many shocks. Monetary 
policy and tax incentives for investment have made important 
contributions in accelerating the expansion in recent years. 
The most recent release of Fed minutes indicates that the 
central bank expects the economic growth to continue through 
2006. The Blue Chip Consensus of private economic forecasters 
also suggests that the economy will grow in excess of 3 percent 
next year, and that employment will continue to rise.
    [The prepared statement of Representative Saxton appears in 
the Submissions for the Record on page 15.]

OPENING STATEMENT OF HON. JACK REED, A U.S. SENATOR FROM RHODE 
                             ISLAND

    Representative Saxton. I would like to ask our Ranking 
Member if he would like to make a statement at this point.
    Senator Reed. Thank you very much, Chairman Saxton, thank 
you, Commissioner and your staff, for joining us this morning. 
This hearing gives us the opportunity to continue examining the 
impact of the recent hurricanes on the jobs data and to try to 
discern underlying trends in the labor market. I want to 
commend Commissioner Utgoff for the hard work her staff at the 
Bureau of Labor Statistics has put into producing these 
statistics under extraordinary circumstances, particularly the 
hurricane.
    As measured by initial claims for unemployment insurance, 
the number of people who have lost their jobs due to Hurricanes 
Katrina and Rita has now exceeded the half million mark, and 
more job losses are expected from Hurricane Wilma. In the 
coming months I hope the reconstruction efforts will stimulate 
a recovery in jobs throughout the region.
    Beyond the hurricane-affected areas, the labor market 
showed signs of losing strength. For the economy as a whole, 
this month's BLS report shows that only 50,000 net jobs were 
created. It appears high gas prices may be squeezing employers 
as well as consumers.
    Even before the hurricanes, the labor market was still 
feeling the effects of the most protracted job slump in 
decades. Cumulative payroll employment growth has been modest 
by the standards of most economic recoveries, and we continue 
to see evidence of hidden unemployment, with labor force 
participation and the fraction of the population with a job 
still at depressed levels.
    The typical worker's earnings are not keeping up with 
rising living expenses, which is squeezing family budgets. 
Gasoline prices have been high, and home heating costs are 
expected to be substantially higher this winter than they were 
last winter. In the past year, real wages have fallen 
throughout the earnings distribution, with the largest declines 
in the bottom half.
    I am pleased that President Bush reversed his unwise 
decision to suspend the Davis-Bacon Act in the hurricane-
ravaged areas and restored Federal wage protection for workers 
on Federal contracts. But the President's steadfast refusal to 
support an increase in the minimum wage still makes it hard to 
take seriously his rhetoric about wanting to lift families out 
of poverty.
    I look forward to the Commissioner's statements and further 
discussion of the October employment situation. Thank you.
    [The prepared statement of Senator Reed appears in the 
Submissions for the Record on page 16.]
    Representative Saxton. Commissioner Utgoff, we will be 
pleased to hear from you at this time. Thank you.

STATEMENT OF KATHLEEN P. UTGOFF, COMMISSIONER, BUREAU OF LABOR 
 STATISTICS, U.S. DEPARTMENT OF LABOR; ACCOMPANIED BY JOHN M. 
GALVIN, ASSOCIATE COMMISSIONER FOR EMPLOYMENT AND UNEMPLOYMENT 
 STATISTICS AND JOHN S. GREENLEES, ASSOCIATE COMMISSIONER FOR 
                  PRICES AND LIVING CONDITIONS

    Commissioner Utgoff. Thank you very much, Mr. Chairman and 
members of the Committee. I appreciate this opportunity to 
comment on the labor market data we released this morning. I 
would also like to say that I have with me Jack Galvin, who is 
Associate Commissioner for Employment and Unemployment, and 
John Greenlees, who is Associate Commissioner for Prices.
    Turning to our data that we released this morning, nonfarm 
payroll employment was little changed in October, and the 
jobless rate was 5.0 percent. Payroll employment was flat in 
September, minus 8,000. That was a revised figure.
    Before discussing the payroll survey data in detail, I 
would note that the October estimates were prepared using the 
same modified procedures that were introduced in September to 
better gauge employment developments in areas affected by 
Hurricane Katrina. We will continue to evaluate our data 
collection and estimation procedures and will resume standard 
survey operations when it is appropriate.
    You will recall that in our analysis of the September 
employment data, we concluded that the weakness was largely due 
to the job loss in areas devastated by Hurricane Katrina. This 
conclusion was based on an estimate of the change in payroll 
employment excluding all of the sample units in the disaster 
areas. That exercise showed that job growth outside the 
disaster area was in line with the average monthly increase for 
the Nation as a whole during the prior year.
    We did a similar exercise for October and concluded that 
the relatively weak increase was not attributable to the areas 
directly affected by Katrina. Rather, job growth in the 
remainder of the country appeared to be below trend in October. 
In addition, the direct impact of Hurricane Rita on the 
national employment data for October was judged to be minimal. 
It is possible, of course, that the employment growth for the 
Nation could have been held down by indirect affects of 
Hurricane Katrina and Rita, for example, because of their 
impacts on gas prices. I will note that Hurricane Wilma made 
landfall after the October survey reference period, so we may 
not see effects of that until next month.
    Turning to the national developments by industry, leisure 
and hospitality employment edged down in October. This follows 
a substantial decline in September, at least some of it which 
was hurricane-related. Employment in retail trade was basically 
unchanged in October after a large decline in September. In 
addition, there was little job growth in professional and 
business services in October. The number of jobs in its 
temporary help component showed little movement over the month 
as well.
    A few major industries posted notable gains in October. 
Employment in the construction industry rose by 33,000 over the 
month compared with average growth of about 21,000 per month 
during the first 9 months of the year. Some of the October gain 
reflects post-hurricane rebuilding and clean-up efforts.
    Employment and financial activities continue to increase, 
rising by 22,000. About half of this gain occurred in credit 
intermediation. Employment, health care, and social assistance 
also continued to expand in October.
    Elsewhere in the economy, employment in the information 
industry fell over the month, mostly because of a large decline 
in motion picture and sound recording.
    Factory employment edged up in October because of the 
return of aerospace workers from a strike. The manufacturing 
workweek rose by an unusually large amount, four tenths of an 
hour. Increases in the factory workweek occurred throughout 
most of the component industries. Average hourly earnings of 
private production for nonsupervisory workers on private 
nonfarm payrolls rose by $0.08 in October to $16.27 following a 
2-cent increase in September. Over the year, average hourly 
earnings were up by 2.9 percent.
    Looking at some of the household survey indicators, the 
jobless rate was 5.0 percent in October. The unemployment rate 
basically has held steady since May of this year. Both the 
labor force participation rate and employment-population ratio 
were little changed in October.
    I would also like to discuss some preliminary findings on 
the employment status of persons directly affected by Hurricane 
Katrina. Shortly after the hurricane struck, Bureau analysts 
together with our colleagues at the Census Bureau devised a 
short series of hurricane-related questions for inclusion in 
the October Current Population Survey. These questions were 
designed to identify and solicit information from survey 
respondents who were evacuated from their homes even 
temporarily because of Hurricane Katrina.
    It is important to note that the estimates based on these 
questions are not representative of all evacuees, but only 
those who were interviewed through normal household survey 
procedures. Some evacuees reside outside the scope of the 
survey, such as those currently living in hotels or shelters.
    Based on information collected by CPS-sampled households, 
there were 791,000 persons aged 16 and over who had evacuated 
from where they were living in August due to Hurricane Katrina. 
About 300,000 of these persons had returned to the home from 
which they evacuated, and the remaining 500,000 had not 
returned to their August residences.
    Of the 800,000 evacuees, 55.7 percent were in the labor 
force in October, and their unemployment rate was 24.5 percent. 
The jobless rate among those who have not been able to return 
home was substantially higher than the rate for those who 
returned to their August place of residence. Again, these 
figures do not reflect the situation of persons still residing 
in shelters, hotels or other places out of the scope of the 
household survey.
    Even with these limitations we believe that these data 
provide useful information about the employment status of those 
persons affected by Hurricane Katrina. As people make the 
transition to more permanent housing, the estimates may be more 
representative of the situation of all evacuees. We plan to 
keep these special Katrina-related questions in the survey at 
least through January 2006.
    Summarizing labor market developments for October, nonfarm 
payroll employment was little changed over the month, and the 
unemployment rate was 5.0 percent.
    My colleagues and I will now be glad to address your 
questions.
    Representative Saxton. Thank you, Commissioner, for your 
very concise and informative statement.
    [The prepared statement of Ms. Utgoff appears in the 
Submissions for the Record on page 17.]
    Representative Saxton. Commissioner, in your statement you 
have a lot to say about the weather events that occurred, 
namely Hurricane Katrina and Rita, which were back-to-back 
storms at the end of August and the beginning of September.
    In looking at the employment numbers from the month of 
September and now, of course, the month of October, we see a 
much different trend than we had been seeing for the months in 
the first half of the year. In January, we had job growth of 
about 124,000 jobs; in February, 300,000 jobs; in March, 
122,000; in April, 292,000; and that trend continued June, July 
and August. The numbers were 175,000, 277,000 new jobs, and in 
August, 211,000 new jobs.
    When we get to September and see the effects of, for some 
reason--and I assume that you have talked about weather events 
significantly because you think that had something to do with 
it--all of a sudden the September numbers were down to a 
negative 35,000, which have just been revised back up to a 
negative 8,000, and this month's numbers were also on the weak 
side.
    Can you venture some opinion, venture some reasoning that 
would support the notion that the hurricanes have had a lot to 
do with this?
    Commissioner Utgoff. We have come to the conclusion that in 
October, Hurricane Katrina, which is the hurricane that has 
most affected employment, did not cause additional losses, that 
the weak employment situation is throughout the country. I 
think it is fair to speculate that things such as higher gas 
prices have influenced people's behavior in a way that has 
dampened the employment situation.
    The employment in discount stores and supercenters was 
weak, as was employment in leisure and hospitality. These are 
the kinds of places where people are not spending their money 
because they may be spending their money on higher gas prices.
    Representative Saxton. Not spending because they are 
spending it on higher gas prices, that decision that an 
individual or a family has to make about where they are going 
to spend their dollars.
    Commissioner Utgoff. Yes.
    Representative Saxton. In addition to that, wouldn't it 
discourage people to see $3 on the pump? So that affects 
people's behavior, and that negative behavior may be an 
indirect result of the hurricane that we see the resulting 
weakening of the numbers, which occurred simultaneous with the 
occurrence of these weather events.
    Commissioner Utgoff. Yes, yes. There are many strong 
economic numbers that have come out this month, but the 
employment numbers reflect an economy that is not growing as 
rapidly as it has been before.
    Representative Saxton. Are there any other indicators in 
the data that you have seen that would say that there are other 
factors at play here?
    Commissioner Utgoff. I would like to point out that 
manufacturing showed a small gain because of return from a 
strike, but there was also a 0.4 percent gain in hours in the 
manufacturing industry spread throughout the entire industry, 
which is often a sign that employers are on the cusp of 
bringing back additional people. First they add hours, and then 
they add additional people. So that may be one positive sign, 
for this month for employment to be stronger next month. We 
also have the lingering effect of Hurricane Rita and Wilma, 
which really did not show up this month in the data because of 
the timing of the survey and may show up in later months.
    Representative Saxton. So the results of Rita are not in 
this survey?
    Commissioner Utgoff. They are, but we had good response 
rates from employers who were affected by the hurricane. Next 
month there may be rebuilding, there may be other activities 
that go on that will affect the employment situation.
    Representative Saxton. Can you shed any light for us on the 
difficulties that may have resulted from the devastating storms 
that occurred in having an effect on your ability to collect 
and analyze this work-related data?
    Commissioner Utgoff. The last 2 months have shown a real 
effort by dedicated public servants to get out the best numbers 
possible so that we could judge what was happening in the 
economy. The Census Bureau made every opportunity to get to 
every household that they could. There were two parishes that 
they were not able to get into because they were completely 
evacuated. They got back into those parishes this month. There 
was a higher response rate. That is for the household survey.
    In the payroll survey, Herculean efforts were made to get 
responses from people that when normally they would do things 
like many people who do touchtone entry, where they pick up the 
phone and they just push--call a number and push a few buttons, 
and that is their response, we called all those people 
individually. People worked long hours to contact virtually 
every person they could in the hurricane-affected areas.
    Jack Galvin, Associate Commissioner for Employment.
    Mr. Galvin. That covers it pretty well. We also had cases 
of establishment survey respondents seeking out different 
numbers to reach us and report their information via touchtone 
data entry. Our 1-800 numbers were down for a while, but these 
employers thought it important to report their numbers.
    Representative Saxton. I see. The lack of communication 
that resulted in the couple of weeks immediately after Katrina 
seemed to have been a very significant impediment to me in 
regard to your ability to collect data. I had a friend who 
still lives in New Orleans, who ended up in Baton Rouge, and I 
tried to call him for 2 weeks with no luck, and he was in Baton 
Rouge. It must have posed some real challenges.
    Commissioner Utgoff. We didn't change the definitions of 
employment for the payroll survey, but as we discussed last 
month, we did change the statistical analysis of those numbers. 
For your friend who may have owned a business, if he didn't 
report, in normal months we would have assumed that in first 
closing if you didn't report, in the first period you didn't 
report, that you looked like other people in your class, size, 
industry, area, and we didn't assume that this time. We assumed 
that people who reported zero employment did have zero 
employment. We went through all of our procedures for 
estimating employment and changed many of them.
    Representative Saxton. Yesterday Chairman Greenspan was 
here to testify before the Joint Economic Committee, and he was 
pleased to reflect on the 3.8 percent growth that we saw in the 
last quarter; he was pleased to project that growth will 
continue in the next year or so at a rate, GDP rate, above 3 
percent. He was pleased to talk about low long-term interest 
rates. He was pleased to see that in spite of Katrina and Rita 
and Wilma, and in spite of uncertainties created by the Gulf 
War, by the war on terror, and in spite of the interest rate 
increases that the Fed has deemed necessary, that he expects 
the economy to continue to grow.
    Do you see anything in the numbers that would speak 
contrary to that view?
    Commissioner Utgoff. The numbers that we are putting out, 
many of them are very strong. The only cause for concern is 
this month's employment situation is relatively weak compared 
to the very strong employment growth that we have been seeing 
earlier.
    Representative Saxton. In that regard previous 
Commissioners always have warned us about reading too much into 
the monthly data release. Would you say that this month's data 
is statistically significant, or is it something that we need 
to wait and see as we move forward?
    Commissioner Utgoff. I will say the same thing as every 
other Commissioner: One month data is not something that you 
want to make a significant judgment on.
    Representative Saxton. We have got the weather events that 
could have a temporary affect here, and we know from past 
experience that the statistical significance of 1 month's 
numbers are not always particularly meaningful.
    Commissioner Utgoff. Yes.
    Representative Saxton. Thank you, Commissioner.
    Mr. Reed; I'm sorry, Senator Reed. My friend.
    Senator Reed. Jack.
    Thank you, Commissioner, and thank you, Mr. Chairman.
    We were seeing what appeared to be sustained job growth 
over the last several months, but I understand the August 
number was revised down from the initial report; is that 
correct?
    Commissioner Utgoff. Yes, that is correct.
    Senator Reed. The initial report for August jobs was?
    Do we recall a revised number?
    Commissioner Utgoff. Just a moment.
    Mr. Galvin. When we reported August back in September, we 
reported it at 169-, then in our second closing last month we 
revised it up to 211-, and now we are reporting 148-.
    Senator Reed. We went from 211- to 148-, and that was 
before Katrina and Rita and Wilma; is that correct, before the 
hurricanes?
    Commissioner Utgoff. Yes, the August number would not have 
been affected by the hurricanes.
    Senator Reed. So what we were seeing was growth, and 
something suddenly might have happened in August to cause a 
revision downward. Then we have this month's report, which I 
thought was interesting, because in response to the Chairman's 
question, you point out you did not really see the primary 
affects of the hurricane because the weakness was nationwide; 
is that a fair statement?
    Commissioner Utgoff. Yes.
    Senator Reed. And so, we saw revised numbers downward in 
August, we had a hurricane, and now we are seeing very, I think 
being polite, modest growth in jobs in this month, which is 
nationwide and not targeted to the hurricane effects.
    The other aspect here I think is interesting is labor force 
participation. That seems to be consistently poor. In fact, I 
think there was a slight increase--I should say a slight 
decrease in labor force participation in October?
    Commissioner Utgoff. Down one tenth of a percent.
    Senator Reed. Down a tenth. Not statistically significant, 
but indicating there is a huge reservoir of people who are not 
counted in the unemployment rolls because they are not actively 
seeking work, and that seems to be stable at high levels. I 
guess historically in terms of a recovery from a recession, 
these levels of workforce participation seem to be high; is 
that accurate, too?
    Commissioner Utgoff. The decrease in labor force 
participation that occurred with the recession that started in 
2000 was significant and has not returned to prerecession 
levels.
    Senator Reed. I think that is a significant issue when it 
comes to the truth of the situation of American families across 
the country.
    We have been talking about payroll growth and job growth, 
et cetera, but unemployment claims for this month seem to be 
growing also; is that fair?
    Commissioner Utgoff. I believe that the initial claims 
were----
    Mr. Galvin. Overall initial claims declined, 12,000.
    Senator Reed. How about in terms of, again, talking in 
terms of the hurricanes; are those claims still coming out of 
the hurricane areas?
    Commissioner Utgoff. Yes.
    Mr. Galvin. ETA has reported that the number has gone above 
500,000 of initial claims related to the hurricanes.
    Senator Reed. What is your expectation with respect to 
additional claims coming out of those regions? Let me step back 
for a second. Is there a delay because people have difficulty 
because they have been uprooted in filing their claims?
    Commissioner Utgoff. There has been a concerted effort to 
have additional places to file unemployment insurance in all 
the areas that have been affected and to make sure that the 
places where evacuees have gone in large numbers have the 
ability to file for both employment insurance and disaster 
unemployment assistance.
    Senator Reed. Do you expect a significant number of people 
have not yet filed?
    Commissioner Utgoff. I can't opine on that.
    Senator Reed. Let me turn to a final topic. One of the 
things that is both interesting and in a sense disturbing is we 
have an increase in productivity which is substantial, yet 
wages seem to be not reflecting those increases in 
productivity. Productivity went up, wages seem still to be 
rather anemic, and in real terms, wages are falling. If that is 
a trend that is going to continue, that has ominous 
implications for the economy. People are working harder and 
harder, and the overall economy is more productive, and yet 
they are not receiving any increase in wages.
    How does that work for most of the people that work in this 
country? Do you have a comment on that dilemma?
    Commissioner Utgoff. Over the long run we normally see that 
productivity and wages move in the same direction; not always, 
but normally. That has not happened in the last few years. 
Productivity has increased faster than wages and compensation.
    Senator Reed. That might be the long run, but that is--2 
years of data is a significant amount of data, which suggests 
that this is a huge problem, because I think the premise that 
we all have in our market economy is that increased 
productivity will be shared in some sense with increased wages. 
If there is a disconnect between productivity increases and 
wage increases, that is, again, an ominous development in the 
country and I think something we have to be terribly concerned 
about. Thank you.
    Representative Saxton. Mr. McCotter.
    Representative McCotter. Thank you for being here.
    Along similar lines, I am just curious if we have ever had 
a study, because I come from Michigan. Just so you know, we 
hear a lot in Michigan about the outsourcing of jobs, jobs 
lost. One question I can't seem to get answered because I don't 
know if anybody keeps track of it, and if you don't, nobody 
does, is what jobs are lost overseas as opposed to what jobs 
are lost to other States. Is there anywhere I could go find 
that?
    Commissioner Utgoff. We have a survey that addresses part 
of that for large layoffs where there have been 50 or more 
people laid off in a 5-week period and the layoff lasts more 
than a month. We call back the company and ask where the 
movement of jobs has been, and it is far more common for job 
loss to be the result of movement of a company's activities to 
another State or another area than it is for it to be moving 
out of the country. So that outsourcing--there is outsourcing, 
but it represents a relatively small fraction of job loss due 
to the movement of work either within the company or to a 
different company and within the United States and outside the 
United States.
    Representative McCotter. Where can I get that?
    Commissioner Utgoff. We will be happy to send you more 
material. We have both quarterly reports and a year-end report 
that talks about that.
    Representative McCotter. Can I get the latest year-end 
report and the latest quarterly?
    Commissioner Utgoff. Yes.
    Representative McCotter. Along the lines of what the 
Senator talked about, the increase in productivity and the 
stagnation of wages to match that rise, is there any analysis 
of how the flood tide of globalization is causing that? It 
seems to me that one of the problems would be that if you have 
to compete globally with any nation, not simply developed 
democracies, what happens is you will try to do everything you 
can to be more productive, and one of the things that you can't 
because it increases prices of your products would be to reward 
your employees for their increased productivity. Is there 
anywhere to find a correlation between those two? Because it is 
an ominous trend to find people working harder because they are 
forced to compete globally with any country which may or may 
not have similar protections for their people and find out at 
the end of the day that is merely to tread water and to survive 
economically, not to grow and prosper and pursue your American 
dream. Is there anywhere that can be found?
    Commissioner Utgoff. We have data on the increase in wages 
and compensation benefits for the people over the 2-year period 
that you are talking about, and for people who do not have 
significant education, wages have been stagnant or falling. It 
is a stark example of why we really need to have a good 
educational and training system to prevent wage stagnation in a 
world of global competition.
    Representative McCotter. Relative to Michigan specifically 
from what you were just saying, then, is that it is probably 
statistically borne out that the people who are hurt the most 
will be in such areas as manufacturing, it would seem to me, 
because the history has been that you do not need an advanced 
degree although the work is very technical to go into a very 
well-paying job, to be able to produce, and then what we are 
seeing now is that that no longer is a career path, the 
statistics bearing out the people who get the degrees generally 
don't go work at Ford on the assembly line, or they don't work 
in the manufacturing area. Are we seeing then from the 
statistics a special problem within the manufacturing sector 
because of this trend?
    Commissioner Utgoff. The manufacturing executives have told 
the Department of Labor that they have help wanted signs up not 
for assembly-line workers, but for workers who have more 
training and more education; that manufacturing has become much 
more of a high-tech industry where productivity has reduced the 
need for workers with limited education.
    Representative McCotter. If you would indulge me one last 
question. Are they also telling you that they are able to take 
the people who are engaged in the manufacturing sector 
currently and then bring them into those jobs?
    Commissioner Utgoff. They are all very interested in 
training programs either on their own or with the help of the 
Department of Labor and the Department of Education to make 
sure that people graduate from high school with the skills that 
they need to enter the high-tech manufacturing workforce, 
because that is where manufacturing is headed, and to retrain 
their workers to take new jobs.
    Representative McCotter. The high tech.
    Commissioner Utgoff. In higher tech.
    Representative Saxton. Good questions. Thank you.
    Mrs. Maloney.
    Representative Maloney. Welcome.
    Commissioner Utgoff. Thank you.
    Representative Maloney. What fraction of the population 
actually has a job?
    Commissioner Utgoff. Let me get to the numbers.
    Representative Maloney. If you want you can get back to me 
later.
    Commissioner Utgoff. No, no, no. We have all these numbers.
    The employment to population ratio in October 2005 was 62.9 
percent.
    Representative Maloney. What would the unemployment rate be 
if you included people who want to work but have given up? They 
are not officially in the labor force, they have been turned 
down 10 times, and are not actively looking? What would the 
unemployment rate be if you included those people?
    Commissioner Utgoff. In October 2005, our broadest measure 
of labor utilization, U6, was 8.7 percent.
    Representative Maloney. What would the unemployment rate be 
if you included people working part time for economic reasons?
    Commissioner Utgoff. U6 includes those working part time 
for economic reasons.
    Representative Maloney. This also includes people who would 
like to work but have given up?
    Commissioner Utgoff. It includes discouraged workers.
    Representative Maloney. I would argue the real unemployment 
rate is 8.7 percent.
    Anyway, I would like to ask you to clarify for me--first of 
all, I want to go back to the numbers that you gave us. You 
said that there was a net gain of 56,000 jobs in October and a 
loss of 8,000 jobs in the revised September reading. How many 
of those net gain jobs at 56,000 are filled by women, and how 
many are filled by men? Likewise, I think it is important to 
see who it is that is losing a job. How many of the net loss of 
8,000 jobs in the revised reading had been filled by women, and 
how many had been filled by men?
    Commissioner Utgoff. The number that you refer to, 56,000, 
is net. They are both people who have gotten jobs and people 
who have lost jobs.
    Representative Maloney. How many of them were women, and 
how many were men?
    Commissioner Utgoff. We don't have that statistic.
    Representative Maloney. Did you at one time keep that 
statistic?
    Commissioner Utgoff. Yes, we did.
    Representative Maloney. I find that an important statistic 
to have. In fact, Senator Kennedy with the help of Senator 
Reed, proposed an amendment to put it back into the payroll 
data, and I would just like to clarify why the Bureau has 
discontinued the women workers series on the current employment 
statistic survey. Why did you discontinue it? It is half the 
population. That is an important number to study.
    Commissioner Utgoff. The statistic that you are talking 
about would not be available to me to report to you for October 
because----
    Representative Maloney. That wasn't my question. My 
question is why did you stop--why did you discontinue keeping 
that statistic.
    Commissioner Utgoff. The decision was made based on the 
fact that the burden on employers for collecting that statistic 
was not worth the amount of use that statistic was getting. We 
know that because we can measure the hits on the Web site. We 
know that in the last 10 years that 6 articles have been 
written that partially use that data, and we have calculated 
that if it takes employers a minute apiece to answer that 
question, and you use a relatively low bookkeeper salary, that 
the cost of those 6 articles is almost $3.5 million apiece.
    Representative Maloney. I would like to request a copy of 
those six articles. According to the research that we looked 
at, that question has an 86 percent response rate. It is the 
second highest responded-to question of any on the survey; the 
only one being higher is how many employees do you have. The 
only business organizations that responded supported collecting 
the data. There was no business that went on record being 
opposed to collecting the data. They all came out in supporting 
it. Researchers use this data. The Federal Reserve Bank of New 
York has used it, and many others use it.
    So, I cannot understand why in the world you have removed 
it. There is no substitute. Businesses don't seem to have a 
problem with it since they all responded to the comment period 
at OMB, in the original comment period, in support of it. 
Researchers use it, and there seems to be overwhelming support 
for it. The comments submitted to BLS ran 9 to 1 in favor of 
it, and I believe the Senate just voted overwhelmingly, in a 
bipartisan way I might add, to continue collecting it. I must 
say I have signed numerous letters in a bipartisan way in 
support of it, and I have spoken to professional researchers 
who tell me that they use it, that it is valuable. I can't 
understand why getting the number of women employed is not 
important.
    Now in your breakdown of these numbers by industry, how 
many industries do you break it down by?
    Mr. Galvin. Over 1,000 industries.
    Representative Maloney. Eight hundred industries.
    Mr. Galvin. That is the national numbers. The women's 
workers numbers were broken down to a high level of industry 
detail of about 40 high-level sectors.
    Representative Maloney. Forty high-level sectors. I would 
like to look at how you collected it in the past. I might say 
that I went to your Web site in the past, and I have never seen 
it mentioned, it is never in your press releases. If people 
don't know about it, then they won't be using it.
    I would just like to ask you; it was my understanding that 
the New York Federal Reserve testified to the usefulness of 
this data; is that correct, about the New York Federal Reserve 
Bank?
    Commissioner Utgoff. There was a written response from the 
Federal Reserve bank that they had used the data.
    Representative Maloney. If they are using it, I think we 
need to give them the data they need.
    Does collecting this data impose a large burden on BLS, or 
is there some compelling reason why we should not continue to 
collect this data since the response was 9 to 1 in support of 
continuing it? Every business that wrote in wrote in in support 
of it.
    Commissioner Utgoff. First, let me make an important point. 
The data on industry by women is available in the Current 
Population Survey. We are making that more useful to our users 
by producing a longer-time series. It is just the nature of 
when you ask an employer do you want to put this data down, 
when they spend 12 minutes a month--excuse me, 12 minutes a 
year responding to it, they are not going to write a letter.
    It is our job as a statistical agency to make the judgment 
that 12 minutes a month for 400,000 employers is a very large 
burden compared with 6 articles in 10 years.
    Representative Maloney. Commissioner, if no one writes in 
in opposition, why are you even having a comment period if you 
are going to make a decision not based on the comments? Nine to 
one the comments were in support of continuing the data, and 
researchers have told me, that the other data that you are 
using is not the same. They have told me that the CPS data 
comes from a different source, individuals rather than 
employers, and has a smaller sample size. BLS states that--you 
have stated that it is less reliable for month-to-month 
employment changes. The Federal Reserve uses this data. I would 
respectfully urge you to continue collecting it.
    Now, if Congress passes a bill forcing you to collect it, 
would you collect it?
    Commissioner Utgoff. Yes.
    Representative Maloney. I would urge in a bipartisan way 
that we put in such a bill. I know that Senator Kennedy and 
like-minded people will be working in the conference committee 
to keep the legislation in, and, quite frankly, I am absolutely 
appalled that of all the things to cut out, it is keeping data 
on employed women. I think that women's data should be kept, 
and I urge you on your own to make this correction.
    Commissioner Utgoff. We produce voluminous data on women; 
earnings, use of their time, and when they are displaced from 
the workforce. We cover every aspect of women in the labor 
force.
    Representative Maloney. Maybe I should wait until the 
second round.
    Representative Saxton. Actually, Senator Reed and I have 
tentatively agreed not to have a second round.
    Representative Maloney. May I have a follow-up question.
    Representative Saxton. The gentlelady has made her point, 
and you are rapidly approaching the 10-minute--your red light 
has been on for 5 minutes. If you would ask another question 
and conclude, I would appreciate it.
    Senator Reed. I have one more question.
    Representative Maloney. What is the Bureau doing to study 
the wage gap specifically, and what are you doing to determine 
how much of the wage gap is attributed to discrimination by 
employer, and are you designing any surveys on this issue, or 
do you have any surveys on this issue?
    Commissioner Utgoff. We just produced a lengthy report, I 
will send everybody on the Committee a copy, on highlights of 
women's earnings. We publish earnings by age, race, all kinds 
of groups, to compare them to men so that we know in what 
industries women are making progress relative to men, in what 
educational groups women are making progress relative to men, 
occupations. This is a 40-page report that was just recently 
produced and will continue to be produced.
    The data that you say are being dropped were never used by 
the BLS to evaluate women's earnings and the progress of their 
earnings and are not suitable for doing that.
    We will continue to be a major source of information on 
women in the workforce and how women in the workforce are doing 
relative to men by numerous categories.
    Representative Maloney. I thank you for your testimony, and 
you may not be using the information, but other researchers, 
including the Federal Reserve, are using the information on the 
number of women employed, or losing jobs, and that is valuable 
information and I would respectfully urge BLS to place that 
back in their column of items.
    Representative Saxton. Commissioner, I would like to thank 
you for being here with us this morning. We appreciate it very 
much. We always enjoy these sessions, but we enjoy them even 
more when you bring us good news. Hopefully next month we will 
have some good news.
    Commissioner Utgoff. We have had a spate of hurricanes, and 
hopefully that will die down. And no snow storms next month.
    Representative Saxton. Thank you.
    [Whereupon, at 10:22 a.m., the Committee was adjourned.] 

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