
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, July 12, 1994                   TAG: 9407120025
SECTION: BUSINESS                    PAGE: A4   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                 LENGTH: Medium

JOBLESS RATE STILL 6 PERCENT

The nation's unemployment rate held at 6 percent in June and 379,000 people found jobs, the government said Friday. But many new workers got temporary, part-time or low-paying positions rather than careers.

"The overwhelming proportion of the jobs that are being added to the economy are low-wage jobs in the service sector," said Mark Roberts, an economist with the AFL-CIO.

The monthly report by the Labor Department, while good economic news for Main Street America, generated concern on Wall Street, where investors worried that signs of a growing economy could fuel inflation.

The Labor Department said the nation's nonfarm payrolls swelled by far more than many economists had expected. Analysts said they were expecting gains of about a quarter-million, although a few did suggest the report would show an increase of as much as 325,000.

``What we really have now is a situation that is ideal. Employment gains are good, the unemployment rate is down to the lowest level in a long time and inflation is in check,'' said Robert Dederick, chief economist for the Northern Trust Co. in Chicago.

``But it's an uneasy balance,'' he said, because employment gains could help fuel inflation, although ``inflation is not today's problem, it's tomorrow's problem.''

Most of the payroll gains came in lower-paying service sector jobs, primarily temporary positions and restaurant jobs. More than 85 percent of the new hires were in services.

But factories hired an additional 34,000 workers. Construction payrolls were up 16,000. Construction hiring has slowed over the last two months, with most economists blaming higher interest rates.

The report was expected to attract close attention from investors worried that an economy growing too rapidly drives up prices and pushes down the value of their holdings. The one bit of news likely to calm Wall Street was a decrease in average hourly earnings from $11.09 in May to $11.08 in June. The decline, though slight, was an indication that wage inflation remains in check. The average work week was down from 42.1 hours to 42 hours, while overtime remained unchanged at 4.6 hours.

The Labor Department said the civilian labor force was 130.2 million, down half a million, and 7.8 million people were without jobs, compared to 7.9 million in May. But Katharine Abraham, commissioner of the Bureau of Labor Statistics, said interpreting the data was difficult.

``It is especially difficult to interpret monthly labor force movements ... at this time of year, primarily because millions of individuals always move into and out of employment during the early summer, with the exact timing of these movements differing slightly from year to year.''

by CNB