Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, March 10, 1990 TAG: 9003133407
SECTION: BUSINESS PAGE: A5 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
Private economists and the Bush administration said the report was fresh evidence that the economy is rebounding from its anemic 0.9 percent growth rate in the final three months of last year, as measured by the gross national product.
"We believe the economy, after a period of slower growth, is likely to show progress" in 1990, said Michael Boskin, President Bush's chief economic adviser.
He noted that the unemployment rate for black Americans, 10.5 percent, was the lowest since August 1974.
A Labor Department survey of households showed a seasonally adjusted civilian jobless rate of 5.3 percent, the ninth consecutive month at that level. The rate has ranged between 5 percent and 5.5 percent since mid-1988 and is in the lowest range since the early 1970s.
A separate survey of employers showed a non-farm job gain of 372,000, the largest since June 1988. The department revised its figure for January to an increase of 332,000, up from an earlier estimate of 275,000.
Manufacturers added 90,000 workers, the first increase since March 1989.
However, Labor Statistics Commissioner Janet Norwood cautioned that February gains were inflated by temporary factors.
All of the increase at factories was attributed to the return of temporarily laid off auto workers. Other types of manufacturing were sluggish. Also, construction payrolls grew by 60,000 employees, the result of unusually mild weather in February, she told Congress' Joint Economic Committee.
Economist Rudy Oswald of the AFL-CIO warned that the strong dollar, by increasing the price of U.S. goods on overseas markets, will dampen prospects for much improvement in manufacturing payrolls, which are down 199,000 from a year earlier.
Layoffs by Wall Street brokerage houses and job losses at other service firms such as AT&T and IBM haven't been reflected yet in government reports, he said.
Nevertheless, most private economists, who as recently as two months ago were expecting a recession this year, said the economy is beginning 1990 with more vigor than anticipated.
"Right now the recession fear has been pretty well put on the back burner," said economist Robert G. Dederick of Northern Trust Co. in Chicago. "This is an economy which, unless it's hit over the head, just keeps going."
Stock and bond prices both turned down after the report. Brokers said it seemed to dim whatever chances might have existed for any decline in interest rates from the Federal Reserve.
The central bank has been keeping interest rates relatively high in order to slow the economy and curb inflation pressures. It began nudging rates down last June after signs of an impending recession emerged.
However, it's left monetary policy unchanged since December and Federal Reserve Board Chairman Alan Greenspan indicated in recent congressional testimony that central bank policymakers have once again focused policy on dampening inflation.
"It's hard for me to see why they would ease in the near future," said economist David Wyss of DRI/McGraw Hill, a Lexington, Mass., forecasting firm. "We're going to see the Fed holding monetary policy stable in the next few weeks."
Overall, total civilian employment edged up to 118 million. The jobless numbered 6.6 million, about the same as January.
The service sector of the economy added 221,00 jobs, including a gain of 47,000 for health services, 28,000 in government, 17,000 in retail trade and 15,000 in finance, real estate and insurance.
The addition of about 20,000 census workers over the past two months is bolstering the government number and several hundred thousand additional workers will be added in the next few months, Norwood said.
In other details, the department said average hourly earnings posted a 0.6 percent rise in February to $9.87, up from $9.52 a year earlier.
Also, the average manufacturing work week held steady in February at 40.7 hours. Overtime fell slightly from 3.7 hours to 3.6 hours.
In a separate calculation of unemployment that counts members of the armed services stationed in the United States, the February jobless rate was 5.2 percent, the same as January. The rates were also the same as the civilian rate.
February job data\ Adult white men 4.1 percent, up from 4 percent in January.
\ Adult white women 4.1 percent, up from 4 percent.
\ White teen-agers 13.0 percent, up from 12.7 percent.
\ All blacks 10.5 percent, down from 11.3 percent.
\ Adult black men 9.2 percent, down from 11.2 percent.
\ Adult black women 9.4 percent, up from 9.2 percent.
\ Black teen-agers 28 percent, up from 26.7 percent.
\ Hispanics, 7.8 percent up from 7.1 percent.
by CNB