[Joint House and Senate Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



                                                         S. Hrg. 112-60
 
                  THE EMPLOYMENT SITUATION: APRIL 2011

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

                                HEARING

                               before the

                        JOINT ECONOMIC COMMITTEE
                     CONGRESS OF THE UNITED STATES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 6, 2011

                               __________

          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]

SENATE                               HOUSE OF REPRESENTATIVES
Robert P. Casey, Jr., Pennsylvania,  Kevin Brady, Texas, Vice Chairman
    Chairman                         Michael C. Burgess, M.D., Texas
Jeff Bingaman, New Mexico            John Campbell, California
Amy Klobuchar, Minnesota             Sean P. Duffy, Wisconsin
Jim Webb, Virginia                   Justin Amash, Michigan
Mark R. Warner, Virginia,            Mick Mulvaney, South Carolina
Bernard Sanders, Vermont             Maurice D. Hinchey, New York
Jim DeMint, South Carolina           Carolyn B. Maloney, New York
Daniel Coats, Indiana                Loretta Sanchez, California
Mike Lee, Utah                       Elijah E. Cummings, Maryland
Pat Toomey, Pennsylvania

                 William E. Hansen, Executive Director
              Robert P. O'Quinn, Republican Staff Director


                            C O N T E N T S

                              ----------                              

                      Opening Statement of Members

Hon. Robert P. Casey, Jr., Chairman, a U.S. Senator from 
  Pennsylvania...................................................     1
Hon. Kevin Brady, Vice Chairman, a U.S. Representative from Texas     3
Hon. Elijah E. Cummings, a U.S. Representative from Maryland.....     5
Hon. Michael C. Burgess, M.D., a U.S. Representative from Texas..     7

                               Witnesses

Dr. Keith Hall, Commissioner, Bureau of Labor Statistics; Dr. 
  Michael Horrigan, Associate Commissioner for Prices and Living 
  Conditions, Bureau of Labor Statistics; and Mr. Philip Rones, 
  Deputy Commissioner, Bureau of Labor Statistics................     9

                       Submissions for the Record

Chart titled ``Monthly Change in Private Payrolls''..............    24
Chart titled ``An Exceptionally Weak Employment Recovery''.......    25
Chart titled ``Labor Force Participation Rate Lowest Since 1984''    26
Prepared statement of Senator Robert P. Casey, Jr................    27
Prepared statement of Representative Kevin Brady.................    27
Prepared statement of Representative Michael C. Burgess, M.D.....    28
Prepared statement of Dr. Keith Hall, Commissioner, Bureau of 
  Labor Statistics, together with Press Release No. 11-0436......    28
Letter dated May 18, 2011, transmitting Commissioner Hall's 
  response to Representative Burgess.............................    68
Letter dated May 24, 2011, transmitting Commissioner Hall's 
  response to Representative Cummings............................    70
Letter dated May 6, 2011, transmitting questions from Senator Amy 
  Klobuchar to Commissioner Hall.................................    72
Letter dated June 1, 2011, transmitting Commissioner Hall's 
  response to Senator Klobuchar..................................    73


                  THE EMPLOYMENT SITUATION: APRIL 2011

                              ----------                              


                          FRIDAY, MAY 6, 2011

             Congress of the United States,
                          Joint Economic Committee,
                                                    Washington, DC.
    The committee met, persuant to call, at 9:31 a.m. in Room 
106 of the Dirksen Senate Office Building, the Honorable Robert 
P. Casey, Jr., Chairman, presiding.
    Senators present: Casey.
    Representatives present: Brady, Burgess, and Cummings.
    Staff present: Will Hansen, Brenda Arredondo, Gail Cohen, 
Colleen Healy, Andrew Wilson, Jayne McCullough, Ted Boll, and 
Robert O'Quinn.

  OPENING STATEMENT OF HON. ROBERT P. CASEY, JR., CHAIRMAN, A 
                 U.S. SENATOR FROM PENNSYLVANIA

    Chairman Casey. The Committee hearing will come to order. I 
want to thank everyone for being here, and I have an opening 
statement I will make and then I will turn to our Vice 
Chairman, Congressman Brady, and any other Members who want to 
make a statement before introducing Commissioner Hall for his 
statement.
    We are again pleased to have Commissioner Hall and his team 
here with us today. We appreciate your service to the country. 
We have a lot to report on today. Before we get into the 
numbers for this month, I just wanted to add a few words about 
some of the trends we have been seeing over the last couple of 
months.
    While the labor market is still facing significant 
challenges, we know that unemployment is too high, and overall 
employment is still well below the levels prior to the 
recession. We have seen some real strengthening in the labor 
market since the spring of 2010. More private-sector jobs have 
been created, and the unemployment rate has begun to come down, 
though it ticked up this month--and we will get to that in a 
moment.
    If we look at the last 14 months, we have now recorded over 
those 14 months private-sector job gains. During that time we 
have added 2.1 million private-sector jobs. Since the beginning 
of 2011, the labor market has also shown resilience in the face 
of rapidly rising oil and gas prices, continued weakness in the 
housing market, slowing export growth, and winter blizzards 
that delayed some investment and hiring.
    Against these challenges, the trend has been clear. In 
eight of the past nine months the economy has added more than 
100,000 private-sector jobs during each month. In February, 
March, and now April, we have added more than 200,000 private-
sector jobs each month. And I think that is a very good sign 
and a very good trend.
    We are moving in the right direction. We are benefitting, 
in my judgment, from the actions taken in 2009 and 2010 in 
dealing with this challenge. These actions that we have taken 
have put us on the path to growth, and I am pleased to see some 
signs of that this month as well.
    Today's employment report provides further evidence that 
the labor market is getting healthier as the economy continues 
to improve and the recovery continues.
    During April, the economy added 268,000 private-sector 
jobs. Due to the loss of government jobs, overall, the economy 
added 244,000 jobs in April. One of the charts behind me 
clearly shows the trend in employment over the past 14 months, 
a sign that some of the work that we have done in the last 14 
months or so has begun to have an impact.
    [The chart titled ``Monthly Change in Private Payrolls'' 
appears in the Submissions for the Record on page 24.]
    [The chart titled ``An Exceptionally Weak Employment 
Recovery'' appears in the Submissions for the Record on page 
25.]
    [The chart titled ``Labor Force Participation Rate Lowest 
Since 1984'' appears in the Submissions for the Record on page 
26.]
    One sector that has been showing sustained employment 
growth is the manufacturing sector, a key source of good-paying 
jobs and central to our nation's long-term competitiveness. In 
April this sector added 29,000 jobs, and since the end of 2009, 
manufacturing has added a quarter of a million jobs.
    In addition, the professional and business sector added 
51,000 jobs, it's ninth consecutive monthly gain.
    As we know from the news this morning, and we'll hear more 
about this, in the hearing, the unemployment rate has edged up 
to 9.0 from 8.8 in March. While down from its peak of 10.1 
percent in October of 2009, the unemployment rate remains too 
high, with 13.7 million Americans looking for work who cannot 
find it.
    As Chairman of this Committee, I monitor these unemployment 
numbers for each demographic group to ensure that as the 
overall employment rate continues to drop, the unemployment 
rate falls for every group; but unfortunately that is not the 
case.
    The unemployment rate for this month for workers with a 
disability, as one example, workers with a disability, their 
unemployment rate was 14.5 percent, compared to 15.2 percent a 
year ago.
    The high rate of unemployment among people with 
disabilities underscores the need for legislation that I and 
others have worked on. I will be reintroducing, along with 
Congressman Crenshaw from Florida, the Achieving A Better Life 
Experience Act, the so-called A-B-L-E, ABLE Act. In the 
previous Congress, this legislation had substantial bipartisan 
support in both Chambers. The ABLE Act will give individuals 
with disabilities and/or their families access to new, highly 
flexible tax-free savings accounts that could be used to help 
cover a variety of essential expenses for people with 
disabilities, including employment training and educational 
expenses.
    In combination with other support, the ABLE Act can help 
people with disabilities gain new skills and training and 
strengthen their employment prospects.
    Additionally, when we look at particular demographic 
groups--the unemployment rate for veterans was 7.7 percent, 
which is below the overall 9.0 rate. Gulf-Era II veterans, 
meaning those who have served in Iraq and Afghanistan, faced an 
unemployment rate of 10.9 percent. Obviously it is higher than 
both the overall veteran rate and higher than the overall 
unemployment rate.
    The unemployment rate in the African-American community was 
16.1 percent, well above its prerecession level. That number 
for African-Americans was as low as 7.7 percent in August of 
2007.
    For Hispanic workers, the unemployment rate was 11.8, which 
is much higher than it was in 2007. We have got to examine 
these numbers as well as the overall rate.
    In summary, the unemployment rate shows that we are on the 
right track. The economy is continuing its recovery. The 
economy is stronger than a year ago. More people are working. 
Fewer are unemployed. But we must do more to continue down the 
path of this recovery.
    As the first-quarter GDP data show, the recovery is modest, 
and the recent spike in oil and gas prices and continued 
weakness in the housing market present real challenges.
    Federal Reserve Chairman Bernanke and others have noted 
that the weather and other transitory factors contributed to 
the slowdown in the rate of economic growth in the first 
quarter. While they have said that, it is important that 
Congress tackles issues that will protect American workers and 
families now and in the future.
    I believe we need to stop subsidizing the major oil and gas 
companies at a time when the price of oil has spiked, and their 
profits have surged. We have this strange situation where they 
get our tax subsidies; they're getting record profits; and the 
gas prices for families go through the roof.
    I think we must crack down on the unfair trade practices 
that China engages in on a daily basis, and we need to put our 
fiscal house in order: cutting spending, reducing waste, fraud, 
and abuse, and bringing down the deficit and especially long-
term debt.
    The job before us is to build upon the progress to date, 
creating more jobs and bringing the unemployment rate down, and 
I look forward to working with members of the Committee on 
these and other challenges to support the economic recovery.
    And now I would like to turn to our Vice Chairman, 
Congressman Brady.
    [The prepared statement of Senator Casey appears in the 
Submissions for the Record on page 27.]

 OPENING STATEMENT OF HON. KEVIN BRADY, VICE CHAIRMAN, A U.S. 
                   REPRESENTATIVE FROM TEXAS

    Vice Chairman Brady. Well thank you, Chairman.
    Dr. Hall, we welcome you and your colleagues again this 
morning.
    During April, initial unemployment claims surged from 
385,000 for the first week to 474,000 for the last week in 
April. The last time that initial claims were this high was 
October of last year. This development is extremely unsettling, 
as we have been expecting continued improvement in the labor 
market.
    While the job growth is welcomed, today's employment 
report, coming on the heels of these troubling initial claims 
data, is showing some disconcerting signs. Nine percent 
unemployment and a rise in the number of workers who have 
recently lost their jobs are disappointing statistics. We need 
still faster private sector job creation. Otherwise, millions 
of U.S. workers will languish in unemployment whether they are 
counted as such or have dropped out of the labor force, and 
millions more will remain underemployed or live in fear of 
losing their jobs. The Economist recently asked the question: 
``What's wrong with America's economy?'' In answering its 
question, The Economist pointed to America's public finances 
and its labor market. Moreover, The Economist stated that the 
recent decline in the unemployment rate is misleading because 
it is a result of surprisingly small growth in the work force 
as discouraged workers drop out. The labor force participation 
rate remains at the lowest level in more than a quarter 
century.
    It is frustrating beyond words to see the excruciatingly 
slow progress in employment growth, especially while President 
Obama pursues policies that obstruct economic activity and job 
creation. The energy industry in America is a prime example. 
Under this Administration, the energy manufacturing and energy 
services industry is suffering from the de facto drilling 
moratorium on vast offshore areas, a molasses-like permitting 
process, and threats of adverse tax changes that will ship jobs 
and production overseas.
    We should not be content with pouring over these employment 
numbers month after month and bemoaning the slow progress. 
Perhaps we can blame it on the weather, or China, or on 
American energy, but we know what is causing this growth 
problem. So let's fix it.
    Let me show you again, as I did at last month's hearing, 
the payroll job performance during and after this recession, 
compared with that during and after the other two major postwar 
recessions. This chart demonstrates how we are underperforming 
relative to past experience. This is an exceptionally weak 
recovery.
    There is no excuse for the dismal job performance. You 
cannot explain it by saying the financial crisis caused the 
severe recession but then fail to encourage private-sector 
growth by every means possible. Why does the President have an 
obsession with raising taxes? Why does he persist with his 
``green jobs'' mantra when the one percent of our energy sector 
for which wind and solar account clearly cannot revive 
America's job market? Americans are demanding real solutions.
    JEC Republicans released one paper in the summer and 
another in the fall of last year that warned treating the BP 
Gulf oil spill as simply an environmental disaster would be a 
mistake.
    By the time the second paper came out in October, the price 
of crude oil had just risen above $80 per barrel. These papers 
explained the importance of continued exploration and 
development in the fastest growth areas for oil production in 
the country to help counteract future oil price volatility.
    In 2010, the United States was the largest source of oil 
supply growth outside of OPEC on the strength of offshore 
production. But this year, the Energy Information 
Administration expects federal Gulf of Mexico oil production to 
fall by 240,000 barrels each and every day.
    Energy consulting firm Wood McKinsey estimates a drop of 
375,000 barrels per day in 2011 oil production because new 
development wells could not be brought online. If those barrels 
are imported, how does that help stabilize oil prices? How does 
that help our economy? How does that help our job seekers?
    The price of oil is now $100 per barrel, while the average 
price of gasoline nationwide is just shy of $4 per gallon.
    The private sector is boosting labor productivity. First-
quarter productivity was up by 1.6 percent. However, businesses 
also are sitting on $2 trillion of cash that they will not 
invest because of regulatory uncertainty and fear of higher 
taxes and inflation.
    Therefore, businesses are not creating the jobs necessary 
to reemploy more people and increase the Nation's output 
sufficiently to generate enough tax revenue to support those 
who are sick, retired, or remain unemployed. The annual rate of 
real GDP growth slowed to 1.8 percent in the first quarter.
    President Obama has put the Federal Reserve in a position 
where it feels compelled to hold the federal funds rate at zero 
and buy hundreds of billions of dollars' worth of Treasury 
Bonds.
    The Joint Economic Committee Republicans just released a 
paper on that subject as well entitled, ``Too Lose for Too 
Long.'' The Federal Reserve is taking a great risk with 
inflation that would not be necessary if the other levers of 
the private economy that the government can impact were set to 
``go.''
    Dr. Hall, I look forward to your testimony.
    [The prepared statement of Representative Brady appears in 
the Submissions for the Record on page 27.]
    Chairman Casey. Thank you.
    Congressman Cummings.

     OPENING STATEMENT OF HON. ELIJAH E. CUMMINGS, A U.S. 
                  REPRESENTATIVE FROM MARYLAND

    Representative Cummings. Thank you very much, Mr. Chairman, 
and I want to thank you for calling this hearing today to 
enable us to examine the current state of employment in our 
Nation.
    I also thank our witness, Dr. Hall, for appearing before us 
today and for following up with my office regarding my 
questions from last month's hearing.
    We learn from today's report, Mr. Chairman, that in April 
the private sector added 268,000 jobs, resulting in an increase 
in nonfarm payrolls of 244,000 jobs.
    These numbers are heartening because they follow 13 
consecutive months of positive job creation. In fact, 1.8 
million new jobs have been created since February 2010.
    When contrasted to an earlier period, January 2008 through 
February 2010, a period during which our economy shed 8.8 
million jobs, it is clear that we have averted a disaster. 
Nonetheless, other indicators clearly show that we must 
continue to make job growth our top economic policy priority.
    We learned yesterday that new claims for unemployment 
unexpectedly rose to an eight-month high of 474,000 
applications. There are currently 13.7 million Americans who 
are unemployed. Almost a third of these individuals have been 
unable to find work for more than one year.
    One out of every ten Americans without a college diploma 
cannot find work. And one out of every six African American 
workers remain unemployed.
    Equally worrisome was a report Monday by The Wall Street 
Journal indicating that there are currently 5.5 million long-
term unemployed Americans who are no longer receiving any 
unemployment benefits. These are our fellow Americans, and they 
are fighting for survival.
    On April 18th I held my annual job fair in Baltimore which 
connects employers with job seekers, and thousands of people 
attended. I saw first-hand the determination and humility of my 
constituents who were simply seeking the opportunity to provide 
for themselves and for their families.
    They are resilient, but they need a chance to succeed. That 
is why I commend Congressman Hoyer and my House Democratic 
colleagues who earlier this week unveiled the continuation of 
our Make It In America Agenda.
    This Agenda consists of numerous bills that will support 
job creation today and in the future by encouraging investment 
in innovation, infrastructure, and education right here at home 
in America. Unfortunately, I fear that my friends across the 
aisle are sacrificing our future in an effort to pay off debts 
created by tax breaks and two wars.
    Nobel Prize-winning economist Joseph Stiglitz wrote in 
Politico last month, and I quote, ``The ballooning of the 
deficit has understandably moved deficit reduction back to the 
center of the debate, but the best way to reduce the deficit is 
to put America back to work.'' End of quote.
    Yet instead of making these critical investments, the House 
Majority's budget proposes to slash job-training programs, Head 
Start, and Pell Grants for college students. This week the 
House Majority voted to pass H.R. 1214, which would repeal the 
section of the Affordable Care Act that funds the construction 
and improvement of school-based health centers. Funding the 
construction of these centers not only ensures children's 
access to these vital and cost-effective services, it creates 
jobs in one of the hardest-hit sectors of the economy: 
construction.
    The Majority's proposed cuts--whether it's the school-based 
health centers, or job training programs--are ostensibly 
defended with the argument that tough times require tough 
choices and sacrifices.
    Unfortunately, these senseless cuts fail to meaningfully 
reduce the debt and instead threaten hundreds of thousands of 
jobs and the well-being of our fellow Americans. This is not 
the time for symbolism. This is the time for smart choices that 
will create jobs and once again make our Nation the land of 
opportunity for all Americans.
    I urge the House Majority to work across the aisle to find 
solutions that will reduce the deficit, help the middle class, 
and put Americans back to work.
    Again, Mr. Chairman, I thank you for this hearing, and I 
yield back.
    Chairman Casey. Thank you, Congressman Cummings.
    Congressman Burgess.

  OPENING STATEMENT OF HON. MICHAEL C. BURGESS, M.D., A U.S. 
                   REPRESENTATIVE FROM TEXAS

    Representative Burgess. Thank you, Mr. Chairman.
    Dr. Hall, Commissioner Hall, always good to see you. Always 
good to start the month off with Commissioner Hall.
    I do want to talk about why the U.S. economy has not 
recovered, and some of the steps we could take to bring the 
economy back. I would like to actually offer, as an example, 
the State where Mr. Brady lives, and where I live, Texas, as a 
good example of the direction where we might--should--head.
    The unemployment rate in Texas is 8.1 percent, certainly 
below the national average, certainly much higher than we would 
like it to be in the State of Texas but nevertheless the Texas 
economy has performed better than any other state because of, 
why? A job-friendly regulatory regime, no state income taxes, 
and the fact that Texas is a right-to-work state.
    As of March, annual job growth in Texas was 3.6 percent, 
compared with a U.S. job-rate growth of 2 percent. The Dallas 
Fed says the unemployment rate in Texas would be even lower 
except for the fact that Texas has had a rapid population 
increase in the last 10 years, of which we are all aware.
    We also accounted for 14 percent of the United States' 
employment growth over the last year. The agreeable weather in 
Texas, better job conditions, are attracting people from all 
over the country, and people are voting with their feet and 
moving to the Lone Star State.
    Over 200,000 jobs were created in the last year. Other 
states could achieve this growth by duplicating Texas's job-
friendly environment.
    In spite of these statistics, our economy in Texas is not 
perfect. We are concerned about unemployment rates for young 
people just getting out of--beginning their earning years. 
Unemployment rates for minorities are unacceptably high, and 
the overall unemployment rate is still, as I said, over 8 
percent, and that is high for Texas.
    But the statistics cited earlier demonstrate that compared 
to the rest of the country something in Texas is working, and 
perhaps Washington and other states could consider a more job-
friendly regulatory regime in order to restore those jobs that 
Mr. Cummings says we need in order to recover the economy.
    One sector of the economy on which I would like to focus is 
the housing market. Housing prices have continued to drop, and 
demand for homes remains low. The housing market, which helps 
drive our economy, is an area that can create job growth and 
will be needed to boost our recovery.
    I would like for Dr. Hall today to discuss the housing 
market's drag on the economy and how that affects our national 
growth.
    Another area of concern, already mentioned by other people 
on this dais, is high commodity prices. Consumers across the 
country face higher oil and food prices. If we do not want the 
economic revival to stall, these prices have to come down.
    The good news yesterday is that oil prices did come under 
$100 a barrel for the first time in a long time. In fact, it 
was rather a significant drop.
    Now what happened yesterday? Oh, the House passed a bill. 
And here we are in the Senate today, and I would just mention 
to the Senate that our bill yesterday to expedite lease sales 
in the Gulf of Mexico, those very leases that have been delayed 
or cancelled by the Administration in the past year, the fact 
that we are willing to expedite those lease sales had a 
profound effect on those people who like to speculate and hedge 
in the oil market.
    They saw that the Republican House was serious about 
addressing the issue of the supply of our oil produced within 
our shores. The Administration has harmed offshore exploration 
in the past year. I don't think there is any question about 
that. We have seen the effect by the price at the pump.
    What will not create jobs is the debt. And the federal debt 
at $14.3 trillion, the number has grown so large that most 
people just simply cannot comprehend it and have given up even 
trying. Canada's debt, to put it in perspective, is about $500 
billion, a half a trillion dollars.
    The Federal Government must find ways to operate like a 
normal family. We all hear about cuts that need to be made, and 
one of the first things we probably need to do is cut up the 
government credit card and stop spending.
    The talk in Washington recently has been about cutting 
spending, and there are cuts that need to be made. But there 
are other things we could be doing here in Congress to cut down 
on government expenses, which are things like waste, which in 
turn frees up resources for Congress to reduce the deficit and 
help those Americans who are out of work.
    Let me just comment briefly--and I will submit the rest of 
my comments for the record. Mr. Cummings mentioned H.R. 1214 
that passed in the House yesterday. This indeed was a bill that 
would take back $100 million, I believe erroneously included as 
a forward-appropriation, a blank check, if you will, a blank 
postdated check, that was included in the Patient Protection 
and Affordable Care Act. The Affordable Care Act is riddled 
with this type of policy where the Federal Government has 
written blank checks, postdated them, put them in the last, and 
all of them are overdrawing the American account.
    Yes, this was a relatively small sum of money, $100 
million, but here's the deal. This money was for the 
construction of clinics. The money--it said in statute, the 
money could not be used to hire a doctor or a nurse, or anyone 
else, to provide care in that clinic.
    Well that is crazy. The American people recognize that that 
is crazy. Even the Administration recognized that it was crazy, 
because this is the only one of the so-called cut bills in the 
Patient Protection and Affordable Care Act where the 
Administration has refused to issue a veto threat as a 
statement of Administration policy.
    Even the President was embarrassed by slipping this $100 
million into the Patient Protection and Affordable Care Act. I 
assume it was done over here in the Senate for some reason, as 
a payoff to someone. I don't--can't identify who, or how, or 
why, but that's the way most of these things work.
    But it was appropriate to bring this money back. We are not 
against school-based clinics. We are against the funding of a 
clinic with no provision for funding for staffing that clinic.
    The normal Federal Qualified Health Center statute says we 
won't build it. You build it; we will help you staff it. This 
legislation had turned things on its head and it was 
appropriate to reverse that course.
    I thank the Chairman for his indulgence, and I will yield 
back the balance of my time and submit the balance of my 
statement for the record.
    [The prepared statement of Representative Burgess appears 
in the Submissions for the Record on page 28.]
    Chairman Casey. Thank you very much.
    Dr. Keith Hall is the Commissioner of the Bureau of Labor 
Statistics for the U.S. Department of Labor. The BLS is an 
independent national statistical agency that collects, 
processes, analyzes, and disseminates essential statistical 
data to the American public, the U.S. Congress, other federal 
agencies, state and local governments, business, and labor.
    Dr. Hall also served as the Chief Economist for the White 
House Council of Economic Advisers for two years under 
President George W. Bush. Prior to that, he was Chief Economist 
for the U.S. Department of Commerce. Dr. Hall also spent 10 
years at the U.S. International Trade Commission. He received 
his B.A. from the University of Virginia, and his Ph.D. and 
M.S. degrees from Purdue University.
    Doctor, thanks again for being here. We are grateful to 
have your testimony.

  STATEMENT OF DR. KEITH HALL, COMMISSIONER, BUREAU OF LABOR 
   STATISTICS, U.S. DEPARTMENT OF LABOR; ACCOMPANIED BY: DR. 
MICHAEL HORRIGAN, ASSOCIATE COMMISSIONER FOR PRICES AND LIVING 
 CONDITIONS, BUREAU OF LABOR STATISTICS; AND MR. PHILIP RONES, 
        DEPUTY COMMISSIONER, BUREAU OF LABOR STATISTICS

    Commissioner Hall. Mr. Chairman and Members of the 
Committee:
    Thank you for the opportunity to discuss the employment and 
unemployment data that we released this morning.
    Nonfarm payroll employment increased by 244,000 in April, 
and the unemployment rate edged up to 9.0 percent. Over the 
last three months, payroll employment has risen by an average 
of 233,000 compared with an average of 104,000 in the prior 3 
months.
    In April, employment increased in several service-providing 
industries, manufacturing, and mining. Retail trade added 
57,000 jobs in April. This increase followed two months in 
which retail employment changed little.
    Over the month, job gains occurred in electronics and 
appliance stores, building and garden supply stores, and 
automobile dealerships. An employment increase in general 
merchandise stores offset a decline of similar size in March.
    Employment in professional and business services rose by 
51,000 in April. Since a low point in September of 2009, 
employment in this industry has increased by 745,000. Several 
component industries continued to add jobs in April, including 
management and technical consulting services, and computer 
systems design services. Employment in temporary help services 
was essentially unchanged in April.
    Employment in leisure and hospitality grew by 46,000 over 
the month and by 151,000 in the last 3 months. Food services 
and drinking places added 27,000 jobs in April and has 
accounted for nearly two-thirds of the gain in leisure and 
hospitality since January.
    Health care employment continued to increase in April, with 
job growth occurring in ambulatory health care and in 
hospitals.
    In the goods-producing sector, manufacturing employment 
rose by 29,000 in April. Since December 2009, manufacturing has 
added a quarter of a million jobs. Durable-goods manufacturing 
has been the source of this growth. Over the month, job gains 
continued in machinery, primary metals, and computer and 
electronic products.
    Employment in mining increased by 11,000 in April following 
a gain of similar magnitude in March. Most of the growth 
occurred in support activities for mining. Since a recent low 
in October of 2009, mining employment has risen by 107,000. 
Elsewhere in the goods-producing sector, construction 
employment was about unchanged over the month. It has shown 
little movement since early 2010, after falling sharply during 
the prior 3 years.
    Employment in state and local government continued to trend 
down in April. Both have been losing jobs since the second half 
of 2008.
    Turning now to measures from the Survey of Households, the 
jobless rate edged up from 8.8 to 9.0 percent in April. 
However, the rate was 0.8 percentage point lower than in 
November of last year. In April, there were 13.7 million 
unemployed persons, little changed from the prior month. The 
number of people unemployed for less than 5 weeks increased by 
242,000 in April. The number jobless for 27 weeks and over 
declined by 283,000 to 5.8 million.
    Other household indicators showed little or no change over 
the month. The labor force participation rate has been 64.2 
percent since January. The employment-to-population ratio has 
changed little at 58.4 percent in April.
    Despite increases in the Household Survey employment since 
late 2009, the ratio has shown little movement. Among the 
employed, the number of individuals working part time who 
preferred full-time work was little changed at 8.6 million.
    In summary, nonfarm payroll employment rose by 244,000 in 
April, and the unemployment rate edged up to 9 percent.
    My colleagues and I would now be glad to answer your 
questions.
    [The prepared statement of Commissioner Hall, together with 
Press Release No. USDL-11-0622, appears in the Submissions for 
the Record on page 28.]
    Chairman Casey. Doctor, thanks so much.
    I wanted to start with the private sector numbers. Those 
numbers, fortunately, have been going up the last several 
months. I wanted to ask you, just by way of review, the number 
for the month of April, that we are looking at is an increase 
of private-sector jobs of 265,000?
    Commissioner Hall. 268,000.
    Chairman Casey. 268,000, I'm sorry. Can you give me the 
numbers for January, February, and March?
    Commissioner Hall. Sure. Well, the last three months it has 
averaged 253,000.
    Chairman Casey. That is the average for the first three 
months of the year?
    Commissioner Hall. The last three months.
    Chairman Casey. The last three months, okay.
    Commissioner Hall. And then the particular months before 
were--yes, total private was 231,000 in March and 261,000 in 
February.
    Chairman Casey. Okay. And in particular I was just 
wondering if you could comment by way of your analysis on the 
sectors, the particular sectors within the private sector 
overall. What are the sectors you see recovering most rapidly? 
And where are there still areas of weakness?
    Commissioner Hall. Sure. The sectors that are showing the 
quickest recovery are professional and business services. We 
have added 584,000 jobs since the labor market trough. 
Education and health has added a little over a half a million 
jobs. Leisure and hospitality has added 290,000 jobs. And 
manufacturing has added 244,000 jobs.
    Still struggling are financial activities. That has 
actually continued to lose jobs. They've lost about 42,000 jobs 
since February of 2010. And construction has held pretty flat. 
They've dropped about 9,000 jobs.
    The biggest declining industry has been--it's not in the 
private sector--has been government. Government has actually 
dropped about 391,000 jobs since June of 2009, since the 
recession ended.
    Chairman Casey. Since June of 2009. And all those other 
numbers refer to that same period?
    Commissioner Hall. Yes, those are since the labor market 
trough. Those were since February of 2010. I changed times on 
you a little bit there.
    Chairman Casey. Okay. We know that this month the two 
surveys, the household survey and the payroll survey, show 
numbers that are in conflict. I just wanted to have you review 
that.
    The payroll survey shows strong growth in overall job 
creation, about 200,000 jobs added. But the household survey 
shows that there were 200,000 fewer workers employed. Is that 
typical to have conflicting stories from those two surveys 
during a recovery?
    Commissioner Hall. Yes. It's certainly not typical. We 
often get some slightly mixed signals. And the main reason is 
that they are different surveys. So there is some variation 
between the surveys.
    I do find, though, that over say three months or so they do 
tend to come into alignment, but month by month they sometimes 
give you slightly mixed signals.
    Chairman Casey. Could you just give us 30 seconds on the 
difference between the two surveys? How they're compiled, what 
they tell?
    Commissioner Hall. Okay, sure. When we talk about payroll 
jobs, we are actually talking about a very large survey where 
we survey business establishments. We are asking them how many 
people are on your payrolls.
    We are taking advantage of the Unemployment Insurance 
Program because they look at the Unemployment Insurance 
records. That is a very, very large survey, and it in fact 
represents about 4 million people. So that is 4 million out of 
130 million payroll jobs. So that is what makes that a fairly 
accurate number. And when we say we gained 244,000 jobs, we are 
looking at that survey.
    With the household survey, that is actually a telephone 
survey. It is a much smaller survey. And it is designed to give 
you an unemployment rate. It is not designed to give you a 
number employed. So, for example, when the Household Survey, 
you said it showed a drop of 200,000 jobs?
    Chairman Casey. Right.
    Commissioner Hall. The uncertainty in that is about 400,000 
jobs. So really we are talking about plus-or-minus 400,000 jobs 
when we say ``minus 200.'' So it is either like we gain 200,000 
or we dropped 600,000. That is the range.
    Chairman Casey. So it is almost like, I don't want to 
create too much of a direct analogy, but it is more like a 
survey; it is more like polling, in a sense. You have a margin 
of error there.
    Commissioner Hall. Right. Yes, that's right. And it is 
really designed to give you a focus on the accuracy of the 
unemployment rate itself. So, for example, typically the 
uncertainty in the unemployment rate is point, two-tenths of a 
percent. So it is fairly accurate for that, but not so accurate 
for the levels.
    Chairman Casey. Okay. Just so people are clear what we are 
discussing, the household survey leads to the percentage 
unemployment rate that we----
    Commissioner Hall. Yes, that's correct.
    Chairman Casey [continuing]. Pay attention to.
    Thank you very much. Vice Chair Brady.
    Vice Chairman Brady. Thank you, Mr. Chairman, Dr. Hall.
    Every month of new job growth is welcome, but this is by 
any measure an exceptionally weak recovery, especially given 
the trillions of dollars thrown at the economy by the White 
House and the Federal Reserve. And I always note that here we 
are, after having spent all of that federal stimulus money, and 
we actually have 1.8 million fewer Americans working than 
before when all that money was spent.
    As to this month, usually a small jump in the unemployment 
rate signals people moving back into the work force, which can 
be a good thing. But the rise in jobless claims and the jump in 
workers recently laid off are not signs of a healthy economy, 
or a healthy recovery.
    The number of unemployed who lost their jobs recently 
increased by 242,000. This jump comes on the heels of large 
increases in initial unemployment claims, the 474,000, which we 
have not seen that high since last summer.
    Commissioner, shouldn't we be watching the statistics very 
carefully going forward?
    Commissioner Hall. I would say absolutely. The payroll job 
growth is, at least the last three months, has been--is 
accelerated. So that is a good sign. But we have not yet seen 
some things that we would like to see in a strengthening 
recovery.
    Vice Chairman Brady. Well Initial Job Claims, that was a 
big jump. We have had four weeks in a row of----
    Commissioner Hall. Sure.
    Vice Chairman Brady. [continuing] Increasing jobless 
claims. That is not expected in a healthy recovery. And those 
who have just lost their jobs recently is large, as well.
    Could these data be pointing to a weakening job market? 
Because normally we ought to have--it ought to be going in the 
other direction.
    Commissioner Hall. Right. I would say that the number of 
new unemployment claims is in fact a helpful data. And that is 
a--that rise is not a good signal.
    Vice Chairman Brady. Yes. What do you think is happening 
here?
    Commissioner Hall. You know, it is hard to say.
    Vice Chairman Brady. Because the numbers seem to be all 
over the map, frankly. I mean----
    Commissioner Hall. You know, I think, while focusing on one 
month's data is important, but I think you need to sort of also 
look back at the trend and sort of see how the trend goes.
    Sometimes maybe at points like this you need to wait and 
see how the data looks over the next month or two to sort of 
see if that has signaled anything.
    Vice Chairman Brady. Yes. Well we have been watching over 
the last two years and seen the recovery much slower than 1981 
and 1982. We have an estimated $2 trillion of capital sitting 
on the sideline; businesses tell us they just are reluctant to 
invest it in new jobs, new equipment, new structures, new 
buildings, until they see more certainty coming out of 
Washington.
    I did notice--I always appreciate the data you give. I did 
notice that there were increases in leisure and hospitality 
this last month, but that you attributed it in your remarks, 
two-thirds of it were related to drinking places and food 
service. So is the bar industry doing better these days? And is 
that a--I'm being facetious, but there is a jump in drinking 
place employment?
    Commissioner Hall. Yes, that was responsible for most of 
the growth in leisure and hospitality.
    Vice Chairman Brady. I'm teasing. I'm just trying to look 
for the--we are all looking for, I think, the optimistic signs, 
and we see some private-sector job growth that I think seems to 
be a good sign. But the longer term recovery means to get more 
people into the work force, because right now we are at the 
lowest number of workers participating in the economy in a 
quarter of a century.
    So even as we look at the unemployment rate, look for 
hopeful signs, the truth is very few people are participating. 
Or at least a lot of people are not participating in this work 
force. Again, troubling signs as we go forward.
    So we will continue to watch these, obviously, month to 
month, but this really is--we are seeing some disconcerting 
signs.
    I yield back.
    Chairman Casey. Dr. Burgess.
    Representative Burgess. Thank you.
    Dr. Hall, just so I can be sure that I am clear. In your 
prepared testimony you talked about gains in the mining sector. 
And that includes oil and gas exploration and extraction?
    Commissioner Hall. Yes, it does.
    Representative Burgess. And does that include both offshore 
and onshore?
    Commissioner Hall. Yes.
    Representative Burgess. Now just looking at the Table A-14 
under the Household data, under that line item of Mining, 
Quarrying, Gas & Oil Extraction, the unemployment rate a year 
ago was 9.4 percent; April of 2011, 3.5 percent, which gives 
that one of the lowest unemployment rates--in fact, it rivals 
government workers for its low unemployment rate. Is that 
correct?
    Commissioner Hall. Yes.
    Representative Burgess. Is there a way--I guess what is 
confusing me is, on your prepared testimony you said employment 
in mining increased 11,000 in April. And I assume we're talking 
about oil and gas exploration and extraction in that 11,000?
    Commissioner Hall. Yes, that's part of it. Yes.
    Representative Burgess. But of course we also know that 
because of federal policies we have put a lot of pressure on 
the actual mining/mining, like coal mining. So do those two 
things tend to offset each other?
    Commissioner Hall. Actually, this particular month both oil 
and gas extraction and mining, except oil and gas, added jobs 
this month. Oil and gas added about 2,000 jobs. Mining, except 
oil and gas, added about 2--did I say million? 2,000. Mining, 
except oil and gas, added about 2,700.
    Representative Burgess. Let me ask you this: Do we know 
what is the total universe of people that are employed in these 
industries?
    Commissioner Hall. Well mining together is about 720,000 
people.
    Representative Burgess. But that includes offshore and 
onshore, exploration and extraction?
    Commissioner Hall. Right. Oil and gas extraction is about 
170,000, and mining otherwise is about 210,000.
    Representative Burgess. On the previous table, A-13, 
construction and extraction occupations are lumped together. 
This is the employed and unemployed persons by occupation, not 
seasonally adjusted.
    Commissioner Hall. Yes.
    Representative Burgess. Can we break those out for which--
because obviously construction, I mean when I look at Table A-
14, the unemployment rate for construction in April of this 
year is 17.8 percent, almost 18 percent. So that is one of the 
highest--well, that is the highest unemployment rate in the 
current jobs report, is in the construction industry. And yet 
at Table A-13, it's construction and extraction are added 
together. So like the total employed in April of 2011 is 7,042, 
but we already know that the greatest number, the greatest 
unemployment--the highest unemployment rate is in the 
construction industry. So how am I to interpret that? How am I 
to break that down?
    Commissioner Hall. Umm----
    Representative Burgess. If I am looking sort of like for 
the total universe of people----
    Commissioner Hall. Right.
    Representative Burgess [continuing]. On which these 
construction numbers and the mining numbers are based?
    Commissioner Hall. Sure. Well we do not have it in this 
release, but we can probably break this out a bit finer for 
you, if you would like.
    Representative Burgess. Well I think that would be helpful.
    [Letter dated May 18, 2011, transmitting Commissioner 
Hall's response to Representative Burgess appears in the 
Submissions for the Record on page 68.]
    Representative Burgess. I mean we, on the policy making 
side, I mean you heard some of it referenced this morning where 
some people are talking about significantly increasing taxes on 
the oil and gas industry. I don't know, maybe that is 
necessary, maybe it is not. We do seem to give a lot away to 
the so-called green jobs' sector.
    Now where are the green jobs on this?
    Commissioner Hall. At the moment, the green--well, first of 
all, it depends on how you define ``green jobs.''
    Representative Burgess. I don't know how to define it. I 
just hear people talking about green jobs. I am leaving that up 
to you all, the smart people.
    Commissioner Hall. Well, we are working on a project where 
we will at some point be measuring green jobs. But the big 
issue for us is pulling the green jobs out of the industries 
because there are industries that specialize in green products 
that are sort of spread out throughout. And the big challenge 
for us is separating them from the rest of the industries.
    Representative Burgess. Right. And of course these are 
industries that receive huge subsidies, huge subsidies in the 
stimulus bill and various other things that we have done, the 
cash for caulkers, and various things that we have done--I say 
``we'' euphemistically; I didn't vote for them and I don't 
think Mr. Brady voted for them--but things that Congress has 
done in the last two years.
    Do we get any--is there any way for us to get a sense of 
what our return-on-investment has been for those big, what 
people call ``green jobs'' and other people call ``green 
pork''? Is there any way to get an idea of the return-on-
investment there? We are talking about raising the ante on the 
extraction and exploration and drilling sector, and again, I 
don't know, maybe that's a good thing. Let's see some data on 
that.
    But we also ought to be supplied some return-on-investment 
data for what has happened with the federal plus-up of these 
other industries.
    Commissioner Hall. Yes, I certainly think that with the 
data as it is now, one might be able to get into that and see 
how some of these industries have done to get some feel for 
that. That is not something that we would normally do. But our 
data probably would educate you somewhat on that as it is right 
now.
    Once we get our green jobs project sort of done where we're 
pulling out the green jobs, you will probably get a better idea 
of that, but that is a ways off.
    Representative Burgess. When could we expect that?
    Commissioner Hall. We are actually going to start 
collecting data next year on it. And so the problem is going to 
be of course, once you start collecting data you do not know 
the baseline. You don't know--but we will have some idea I 
think starting next year with the number of people employed in 
these industries.
    Representative Burgess. Well that is Heisenberg's 
Uncertainty Principle, the mere fact that you're looking at 
something means you can't be certain?
    Commissioner Hall. Well, as I say, we have worked hard on 
getting a definition that makes sense.
    Representative Burgess. Very well. Well I will look forward 
to that. And again, I think it would be so helpful for us on 
the policy making side, because we are going to be asked some 
big questions. It will be great to know what the return-on-
investment has been for the federal investment in this type of 
activity.
    I'm not complaining about it. Texas has a great number of 
wind farms that we did not have 20 years ago, and surely there 
has been some effect. But it would be nice to know what kind of 
return-on-investment do we get for making those expenditures.
    Thank you. I'll yield back, Mr. Chairman.
    Chairman Casey. Thank you.
    Congressman Cummings.
    Representative Cummings. Thank you, Dr. Hall.
    As you know, the Treasury Department has reported that the 
United States is expected to hit its debt ceiling on May 16th. 
Congressional Quarterly has reported that, in anticipation of 
hitting the debt ceiling, today Treasury will stop issuing 
state and local government series Treasury securities which 
help state and local governments fund infrastructure and other 
projects.
    I find this deeply concerning because we are already seeing 
layoffs taking place at the state and local level. If I 
remember correctly, you said that we have had a significant 
decrease in government jobs? Is that right?
    Commissioner Hall. That's correct.
    Representative Cummings. Dr. Hall, can you give us further 
detail for the Committee on the current job situation 
throughout the state and local governments across the country? 
And can you offer any predictions regarding the impact that 
that Treasury action may have on the state and local 
governments' employment levels?
    Commissioner Hall. Sure. In terms of government employment, 
the government job loss has been centered primarily in local 
government jobs. So, for example, local government, since the 
end of the Recession, has continued to lose jobs, something on 
the order of 370,000 jobs, which is a pretty high number. And 
that has been the bulk of the government job loss since the end 
of the Recession, which has lost 391,000. So that is not an 
insignificant number of employees.
    Representative Cummings. And would your research go into 
whether women are disproportionately affected when it comes to 
those government jobs? In other words, is it a high number of 
women who are employed by government?
    Commissioner Hall. Yes. I don't have it in front of me, but 
I think we should be able to get you some idea of that. I would 
think, especially in the local government.
    [Letter dated May 24, 2011, transmitting Commissioner 
Hall's response to Representative Cummings appears in the 
Submissions for the Record on page 70.]
    Representative Cummings. I notice that the African American 
workers' unemployment rate increased. Is that right?
    Commissioner Hall. Yes, it did.
    Representative Cummings. What were those figures?
    Commissioner Hall. The African American unemployment rate 
went from 15.5 percent to 16.1 percent this month. So it was an 
increase of about 6/10ths of a percent.
    Representative Cummings. Do you consider that significant?
    Commissioner Hall. It is not statistically significant. It 
is not a really large sample, so statistical significance is 
probably somewhere around 1.0 percentage point.
    Representative Cummings. You know, when you were answering 
I think it was one of Congressman Brady's questions, you were 
saying that we have to--and you have said this in the past--
that we cannot take just one snapshot of a month, but we have 
to look at a trend in where we are.
    So how do you see this month's numbers fitting into the 
trend? And do you see--do you have--does anything here cause 
you to have any significant concerns that we may be going in 
the wrong direction?
    Commissioner Hall. I would say in terms of trends, let me 
just say that the news that jumps out the most to me is that we 
now have three months of payroll job growth, well above 200,000 
jobs, about a quarter of a million a month in private sector.
    Representative Cummings. Is that significant?
    Commissioner Hall. Yes, that is significant. And I also 
think it is important in that you need about, over a long time 
period, you need about 130,000 jobs a month to employ new 
people entering the job market, the growth in the population, 
growth in the labor force.
    So we are now getting well above the 130,000 per month jobs 
you need. So this last three months looks like it has been an 
acceleration of the job growth.
    Representative Cummings. Now we are about to have many of 
our young people graduating from college. How do you see that 
impacting? In other words, when we have this month of May and 
June where people are coming out of high school, coming out of 
college, looking for jobs, how does that affect your numbers 
during that course? In other words, is there a big bump-up in 
demand, so therefore that affects the numbers?
    And what has been the trend, I guess, I am asking you?
    Commissioner Hall. You know, I think one of the things that 
has been most concerning say over the past year has been the 
labor force has not grown very much. The labor force has been 
very flat, which means we have not had the normal entry into 
the labor force on net that we normally get.
    Representative Cummings. And some of those people are, I 
guess, some of those young people are staying in school longer?
    Commissioner Hall. Yes, that's right.
    Representative Cummings. And then we are losing some people 
that have just stopped looking for work? Is that it?
    Commissioner Hall. That's right. That's right. I would 
consider it to be another phase of the recovery when we start 
to get an increase in the labor force, when people start to get 
optimistic enough that they start to re-enter the labor force 
and start to get some growth.
    It has been concerning that we have not seen much growth in 
the labor force yet.
    Representative Cummings. And my two questions that I always 
ask you: If the President were to ask you, Commissioner Hall, 
where do we go from here? What does it look like? What would 
you say to the President?
    Commissioner Hall. I would say, the good news from this 
report is what appears to be an acceleration in the payroll job 
growth. It was a little bit of a mixed signal, because we did 
have the unemployment rate tick up a little bit. And I think 
kind of what I just mentioned, I think the thing that we would 
look forward to, hopefully we'd like to see going forward, is 
this payroll job growth to continue and maybe accelerate and 
give us enough confidence that we actually see the labor force 
start to grow. I think that would be, like I said, I think that 
would be sort of the next phase in the recovery.
    Representative Cummings. And my other question that I 
always ask you is, if there are people watching this and they 
are trying to find a job, what advice would you give them based 
on geography, areas of growth, people who may be trying to go 
back to school to retrain, based on what we have here, what 
would you tell them?
    Commissioner Hall. Well, you know, obviously I wouldn't 
guide myself by a monthly report because this changes over 
time.
    Representative Cummings. Well let's just talk about trends, 
just about the trends that you see.
    Commissioner Hall. Sure. Well, you know, the trends are 
that we are continuing to see growth in the service-providing 
sector in particular. That sector historically has been a 
little more recession proof than other sectors.
    This recession has been deep enough and bad enough that it 
really has lost jobs, but, as a general rule, that sector does 
better than other sectors.
    And, you know, within that there are lots of occupations 
that are likely to have strong growth over the next 10 years or 
so.
    Representative Cummings. Like health?
    Commissioner Hall. Like health care. Everything from health 
care, to financial examiners, to computer software engineers. A 
number of things like that.
    Representative Cummings. All right. Thank you very much, 
Mr. Chairman.
    Chairman Casey. We will move to a second round, Doctor. I 
wanted to go through this chart for a second.
    What is striking about this chart is that it depicts 
private payrolls starting with the month of January of 2008, 
and it goes through this report that we are looking at now, 
April of 2011. What is stunning about that chart, obviously, is 
you have got, over the course of the last year, the month-by-
month number, the last year of one Administration into the next 
Administration, but for a long, long period of time you have 
negative numbers on private-sector job growth.
    I want to make sure I am reading this right--when we go 
into positive territory, it is what month?
    Commissioner Hall. I believe it was March.
    Chairman Casey. March of?
    Commissioner Hall. March of 2010.
    Chairman Casey. 2010, okay. Is there any way that you can--
I don't know if you have this number--calculate it, or if you 
could get it to us, the number of total growth, the total 
private sector job growth from that date in March of 2010 
through April of 2011? You may have already given that number, 
but I'm not sure where.
    Commissioner Hall. Two million ninety thousand.
    Chairman Casey. So 2,090,000 private-sector jobs created 
since March of 2010 through this month?
    Commissioner Hall. Yes.
    Chairman Casey. Okay. I thought that was significant. And I 
never thought of it in terms of all that, over that amount of 
time.
    The other thing I wanted to look at was the long-term 
unemployed number. If you can provide any kind of, for lack of 
a better word, characteristics of those who were long-term 
unemployed? I am just reading from the first page of your 
official report here.
    The number of long-term unemployed, those jobless for 27 
weeks or over, declined by 283,000 to 5.8 million. Now, 5.8 
million is a huge number. I guess I would ask two questions, 
the one I just referred to, the characteristics or common 
denominator in terms of what type of work or what challenges 
they face. That is question one.
    Question two is: Is there any significance to that decline 
of 283,000? Or is that more of a standard number we have been 
seeing?
    Commissioner Hall. Sure. Well first of all, the very large 
number of long-term unemployed, the rise has been very broad. 
So almost all demographic groups and almost all industries have 
had a big rise of long-term unemployed. But there is some 
overrepresentation in that.
    For example, for those with less than a high school 
diploma, they are very much overrepresented in that. In fact, 
the unemployment rate is like 6.9 percent of just the long-term 
unemployed for those without a high school diploma. Those who 
were either never married, or widowed, divorced, or separated, 
they are overrepresented in the long-term unemployed.
    And then industries, construction stands out as having a 
very large--larger than expected--share of the long-term 
unemployed.
    That number going down a little bit is not uncommon, but 
the thing that is tricky about that is people can drop out of 
being long-term unemployed by just leaving the labor force, or 
by getting a job. And the way it is looking right now, two 
people leave labor force for every one that gets a job out of 
the long-term unemployed for 27 weeks or longer. So it isn't 
necessarily good news to see that go down.
    Chairman Casey. So one of the most compelling pieces of 
data you just cited refers to education levels. So in other 
words, if you have got a high school diploma or less, you are--
I am just trying to put a number on that in terms of the 
likelihood of you being not just unemployed but being part of 
the long-term unemployed.
    Commissioner Hall. You are probably--you are over three 
times more likely to be long-term unemployed than someone with 
a college degree.
    Chairman Casey. Thank you.
    Dr. Burgess, do you have any more?
    Representative Burgess. Thank you.
    Dr. Hall, if I correctly interpreted your answer to Mr. 
Cummings's questions about geographically and with which sector 
of the economy if someone was really serious about getting a 
job right now, they would move to Texas and practice medicine. 
Is that right?
    Commissioner Hall. If you have that option, it is not a bad 
one.
    Representative Burgess. Well, look. Let me ask you another 
question. We deal here with nonfarm payrolls, is that correct?
    Commissioner Hall. Yes.
    Representative Burgess. But there is going to be an effect 
from what is happening in the central part of this country. It 
kind of gets obscured in the headlines of all the other news, 
but there is a huge issue with flooding of the farmland of the 
central part of the United States, more to the Mississippi 
River.
    Do you have an idea as to how that is going to affect 
things? Because we see Missouri, and Arkansas, Memphis, 
Tennessee they said water is up to the sidewalks. What sort of 
effect is that going to have? Or is that just built into, sort 
of baked into the process, baked into the cake where we can 
have a tough agricultural year?
    Commissioner Hall. Well first of all, we do not collect 
data on farm employment. The Department of Agriculture does, 
though, I believe. And they pay a fair amount of attention to 
data on employment in farming. So I am probably not the right 
one to ask.
    Representative Burgess. But if those jobs are not there 
during the growing season, and they certainly may not be if the 
fields are under water, then that will push people into looking 
for work in other sectors. Is that correct? There is bound to 
be a ripple effect, no pun intended, into other parts of the 
job market? Is that not correct?
    Commissioner Hall. Yes. In fact, what would happen is it 
would not--probably not show up in our payroll jobs numbers, 
but it could well show up in our unemployment numbers. Because 
they are two different surveys, and the coverage is slightly 
different. With the unemployment rate, we are making phone 
calls so we will catch some of those jobs with the phone calls. 
But with the payroll jobs, we're only talking to nonfarm 
establishments that pay payroll taxes, basically.
    Representative Burgess. Well again it is an enormous 
tragedy and story that is sort of not--below the radar screen 
for most Americans. I am told by people who live there that it 
is a flood of the proportions of 1927-1928 when fully one 
percent of the usable housing stock of the United States of 
America ended up under water. I mean, it is a similar sort of 
circumstance today.
    So I cannot help but feel it is going to have a profound 
effect on whatever fragile recovery we are experiencing now. 
This is going to take a toll.
    Do you have a sense as to how the actual size of the labor 
force itself, the behavior of that during what has been this 
very prolonged recession? I mean, it seems like the number of 
sort of the total size of the labor force is smaller today than 
what we used to talk about.
    Commissioner Hall. Yes, that is right. The labor force 
participation rate gives you some idea of that, and the labor 
force participation rate is at a very low level. So I think the 
statistics that were up there a minute ago, it is the lowest 
level since the 1980s at some point.
    So that is a concern.
    Representative Burgess. And we talk about all the trouble 
we are having grappling with deficits and what have you, and we 
need to get people back into the work force and paying taxes, 
but I mean it is just going to be harder to do that, isn't it?
    Commissioner Hall. Yes.
    Representative Burgess. Thank you, Mr. Chairman. I will 
yield back the balance of my time.
    Chairman Casey. Thank you, Doctor.
    Commissioner, we are going to let you go in a moment. I had 
one question I meant to ask earlier with regard to Japan and 
any impact that their current situation is having on our 
economy.
    I know it is not an easy question to answer, but with both 
a tsunami and an earthquake, whether or not there is an impact? 
I guess there is some speculation, that there could be an 
impact--maybe on our manufacturing.
    I was told that yesterday's unemployment insurance claims 
data showed that 1,700 employees filed claims after being laid 
off from auto manufacturers in Ohio. Any data that suggests 
that that could be related to what is happening in Japan?
    And then, secondarily, more broadly, is there any data that 
indicates a broader impact from what has happened in Japan?
    Commissioner Hall. As I understand it, there have been some 
very short-term plant closings related to this, like one day, 
et cetera. And since the workers were employed most of the 
time, just having like a one-day plant closing, it doesn't show 
up as a payroll job lost. It will lower our hours worked a 
little bit, but not really affect the payroll jobs.
    My expectation would be, if it is going to have an impact 
on the payroll jobs in particular, that would likely start next 
month. And we will see what we can see in the employment 
numbers in the automobile plants next month, and see if maybe 
there is an effect from that.
    Chairman Casey. Okay. Dr. Hall, Dr. Horrigan, Mr. Rones, we 
are grateful to have you here again, and this hearing is 
adjourned.
    [Whereupon, at 10:38 a.m., Friday, May 6, 2011, the hearing 
of the Joint Economic Committee was adjourned.]

                       SUBMISSIONS FOR THE RECORD

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 Prepared Statement of Robert P. Casey, Jr., Chairman, Joint Economic 
                               Committee

Washington, DC--U.S. Senator Bob Casey (D-PA), Chairman of the U.S. 
Congress Joint Economic Committee (JEC), released the following 
statement on the Bureau of Labor Statistics' April jobs report showing 
that the unemployment rate edged up to 9.0 percent and 244,000 total 
nonfarm jobs were added:
    ``April was another solid month of job creation. In the past three 
months, we've averaged more than 250,000 new private sector jobs each 
month. The recent job creation is a sign that policies put into place 
during the last Congress to spur hiring and strengthen small businesses 
are gaining traction.
    ``It was encouraging to see that the economy added jobs across 
nearly all sectors of the economy. Manufacturing, which is especially 
important to the nation's competitive position, gained 29,000 jobs this 
month, and professional and business services has now added jobs for 
nine months in a row. The breadth of the job gains shows that the 
recovery is strengthening, but clearly there is more to be done.
    ``Additional progress reducing unemployment is critical to the 13.7 
million Americans who are looking for work, but can't find it, and who 
are struggling to make ends meet. With so many people unemployed, the 
economy is still operating below capacity and is not benefitting from 
the skills and labor of those who are currently jobless. Congress needs 
to continue to support the private sector in creating jobs and driving 
new innovations that will boost future economic growth.''

                               __________
Prepared Statement of Representative Kevin Brady, Vice Chairman, Joint 
                           Economic Committee

    Dr. Hall, we welcome you and your colleagues again this morning.
    During April, initial unemployment claims surged from 385,000 for 
the week ending April 2nd to 474,000 for the week ending April 30th. 
The last time that initial claims were this high was October 9, 2010. 
This development is extremely unsettling, as we have been expecting 
continued improvement in the labor market.
    While the job growth is welcomed, today's employment report, coming 
on the heels of those troubling initial claims data, is showing some 
disconcerting signs. Nine percent unemployment and a rise in the number 
of workers who have recently lost their jobs, i.e., within the last 
five weeks, are disappointing statistics. We need still faster private 
sector job creation. Otherwise, millions of U.S. workers will languish 
in unemployment, whether they are counted as such or have dropped out 
of the labor force, and millions more will remain underemployed or live 
in fear of losing their jobs.
    The Economist asked the question, ``What's wrong with America's 
economy?'' In answering its question, the Economist pointed to 
America's public finances and its labor market. Moreover, the Economist 
stated that the recent decline in the unemployment rate is misleading 
because it is the result of surprisingly small growth in the workforce 
as discouraged workers drop out. The labor force participation rate 
remains at the lowest level in more than a quarter century.
    It is frustrating beyond words to see the excruciatingly slow 
progress in employment growth, especially while President Obama pursues 
policies that obstruct economic activity and job creation. The energy 
industry is a prime example. Under this Administration, the energy 
industry is suffering from de facto drilling moratoria on vast offshore 
areas, a molasses-like permitting process, and threats of adverse tax 
changes.
    We should be content with pouring over these employment numbers 
month after month and bemoaning the slow progress. We know what is 
causing this growth problem, so let's fix it.
    Let me show you again, as I did at last month's hearing, the 
payroll job performance during and after this recession compared with 
that during and after the other two major postwar recessions. This 
chart demonstrates how we are underperforming relative to past 
experience.
    There is no excuse for this dismal job performance. You cannot 
explain it by saying that financial crises cause severe recessions, but 
then fail to encourage private sector growth by every means possible. 
Why does President Obama have an obsession with raising taxes? Why does 
he persist with his ``green jobs'' mantra? The one percent of our 
energy sector for which wind and solar account clearly cannot revive 
our job market. Americans are demanding real solutions.
    JEC Republicans released one paper in the summer and another in the 
fall of last year that warned treating the BP Gulf oil spill as simply 
an environmental disaster would be a mistake. By the time the second 
paper came out in October, the price of crude oil had just risen above 
$80 per barrel. These papers explained the importance of continued 
exploration and development in the fastest growth areas for oil 
production in the country to help counteract future oil price 
volatility.
    In 2010, the United States was the largest source of oil supply 
growth outside of OPEC on the strength of offshore production. But this 
year, the Energy Information Administration expects federal Gulf of 
Mexico oil production to fall by 240,000 barrels per day. Energy 
consulting firm Wood McKinsey estimates a drop of about 375,000 barrels 
per day in 2011 oil production because new development wells could not 
be brought on-line. If those barrels are imported, how does that help 
to stabilize the oil price? How does that help our economy? How does 
that help our job seekers? The price of oil is now $100 per barrel, 
while the average price of gasoline nationwide is just shy of $4 per 
gallon.
    The private sector is boosting labor productivity--first quarter 
productivity was up by 1.6%. However, businesses also are sitting on $2 
trillion of cash that they won't invest because of regulatory 
uncertainty and fear of higher taxes and inflation. Therefore, 
businesses are not creating the jobs necessary to reemploy more people 
and increase the nation's output sufficiently to generate enough tax 
revenue to support those who are sick, retired, or remain unemployed. 
The annual rate of real GDP growth slowed to 1.8% in the first quarter.
    President Obama has put the Federal Reserve in a position where it 
feels compelled to hold the federal funds rate at zero and buy hundreds 
of billions of dollars' worth of Treasury bonds. The JEC Republicans 
just released a paper on that subject as well, ``Too Loose for Too 
Long.'' The Federal Reserve is taking a great risk with inflation that 
would not be necessary if the other levers of the private economy that 
the government can move were set to ``go.''
    Dr. Hall, I look forward to hearing your testimony.

                               __________
     Prepared Statement of Representative Michael C. Burgess, M.D.

    A report released in March from the Government Accountability 
Office stated that hundreds of millions, even billions of dollars, 
could be achieved by reducing improper federal payments, addressing the 
gap between taxes owed and paid, reducing duplicative ethanol policies, 
and many more.
    These are just a few ways that efficiencies could be achieved. I 
believe the federal government could also achieve greater efficiencies 
by adopting some of the cost-cutting strategies used by private 
businesses and certain executive agencies, including the U.S. Navy. 
Lean Six Sigma is a plan that doesn't focus on cutting jobs but instead 
concentrates on improving quality, cutting waste, and improving 
efficiency.
    Government workers serve their customers, American constituents, 
just like people do in the private sector. With a $14 trillion debt, 
which will grow by over $1 trillion this year, and has grown by over $1 
trillion for the past two years, our government needs to find 
efficiencies to lower costs.
    Thank you Mr. Chairman, and I yield back.

                               __________
    Prepared Statement of Keith Hall, Commissioner, Bureau of Labor 
                               Statistics

    Mr. Chairman and Members of the Committee:
    Thank you for the opportunity to discuss the employment and 
unemployment data we released this morning.
    Nonfarm payroll employment increased by 244,000 in April, and the 
unemployment rate edged up to 9.0 percent. Over the last 3 months, 
payroll employment has risen by an average of 233,000 compared with an 
average of 104,000 in the prior 3 months. In April, employment 
increased in several service-providing industries, manufacturing, and 
mining.
    Retail trade added 57,000 jobs in April. This increase followed 2 
months in which retail employment changed little. Over the month, job 
gains occurred in electronics and appliance stores, building and garden 
supply stores, and automobile dealerships. An employment increase in 
general merchandise stores (+27,000) offset a decline of similar size 
in March.
    Employment in professional and business services rose by 51,000 in 
April. Since a low point in September 2009, employment in this industry 
has increased by 745,000. Several component industries continued to add 
jobs in April, including management and technical consulting services 
and computer systems design services. Employment in temporary help 
services was essentially unchanged in April.
    Employment in leisure and hospitality grew by 46,000 over the month 
and by 151,000 in the last 3 months. Food services and drinking places 
added 27,000 jobs in April and has accounted for nearly two-thirds of 
the gain in leisure and hospitality since January.
    Health care employment continued to increase in April (+37,000). 
Job growth occurred in ambulatory health care and in hospitals.
    In the goods-producing sector, manufacturing employment rose by 
29,000 in April. Since December 2009, manufacturing has added a quarter 
of a million jobs. Durable-goods manufacturing has been the source of 
this growth. Over the month, job gains continued in machinery, primary 
metals, and computer and electronic products.
    Employment in mining increased by 11,000 in April, following a gain 
of similar magnitude in March. Most of the growth occurred in support 
activities for mining. Since a recent low point in October 2009, mining 
employment has risen by 107,000. Elsewhere in the goods-producing 
sector, construction employment was about unchanged over the month. It 
has shown little net movement since early 2010, after falling sharply 
during the prior 3 years.
    Employment in state government and local government continued to 
trend down in April. Both have been losing jobs since the second half 
of 2008.
    Average hourly earnings of all employees on private nonfarm 
payrolls increased by 3 cents in April to $22.95. Over the past 12 
months, average hourly earnings have risen by 1.9 percent. From March 
2010 to March 2011, the Consumer Price Index for All Urban Consumers 
(CPI-U) rose by 2.7 percent.
    Turning now to measures from the survey of households, the jobless 
rate edged up from 8.8 to 9.0 percent in April. However, the rate was 
0.8 percentage point lower than in November of last year. In April, 
there were 13.7 million unemployed persons, little changed from the 
prior month. The number of people unemployed for less than 5 weeks 
increased by 242,000 in April. The number jobless for 27 weeks and over 
declined by 283,000 to 5.8 million.
    Other household indicators showed little or no change over the 
month. The labor force participation rate has been 64.2 percent since 
January. The employment-population ratio was little changed at 58.4 
percent in April. Despite increases in household survey employment 
since late 2009, the ratio has shown little movement. Among the 
employed, the number of individuals working part time who preferred 
full-time work was little changed at 8.6 million.
    In summary, nonfarm payroll employment rose by 244,000 in April, 
and the unemployment rate edged up to 9.0 percent.
    My colleagues and I now would be glad to answer your questions.

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