Think tanks wrap-up

March 7, 2003 at 6:48 PM
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WASHINGTON, March 7 (UPI) -- The UPI think tank wrap-up is a daily digest covering opinion pieces, reactions to recent news events and position statements released by various think tanks.

The Center for Economic and Policy Research

(CEPR's goal is to ensure that citizens have the information and analysis that allow them to act effectively in the public democratic debate on important economic and social issues that their lives, by informing them about the problems and choices they face in an accurate and understandable manner, so they are better prepared to choose among various policy options.)

WASHINGTON -- Private sector sheds 321,000 jobs in February: The job loss indicates a double dip recession

by Dean Baker

The economy lost 308,000 jobs in February. The loss in the private sector was 321,000. This was the largest loss of private sector jobs (apart from the Sept. 11, 2001, falloff) since a drop of 366,000 in January of 1982. It is important to recognize that this decline is unrelated to the February blizzards, since the survey took place in the second week of the month.

Job losses were spread widely across sectors. Construction lost 48,000 jobs, although part of this was reversing an anomalous jump of 24,000 jobs reported for January. Manufacturing lost 53,000 jobs, with 42,000 of the lost jobs in durable goods industries.

Transportation and communications lost 41,000 jobs. Within this category, trucking lost 17,000 jobs, nearly 1.0 percent of its total employment. Retail trade lost 92,000 jobs, a decline that was almost entirely attributable to a loss of 85,000 restaurant jobs. This is the third consecutive month with sharp job changes in these sectors (retail jobs fell by 95,000 in December and rose by 116,000 in January, while restaurant jobs fell by 66,000 followed by a gain of 82,000).

This suggests problems in seasonal adjustment, but the average job loss for the last four months has been 38,000 in retail and 27,000 in restaurants.

The personal and business service sector lost 86,000 jobs, with the declines spread widely across industries. Health services added just 5,000 jobs, an unusually low figure. The government sector added 13,000 jobs with state and local employment still showing modest increases, in spite of widespread budget shortfalls.

The large job decline was accompanied by a sharp drop of 0.2 hours in the average workweek, although this followed a jump of the same size in January. Most likely the rise reported for January was an aberration.

The establishment survey did show solid wage growth led by a surge in wages in the personal and business service sector. Wages in this sector are reported as rising at a 5.0 percent annual rate for the last three months, pushing overall wage growth to 3.8 percent over this period. This is almost certainly an anomaly; other data indicate wages are growing at close to a 2.5 percent rate.

In spite of the job loss, the unemployment rate rose only slightly to 5.8 percent in January. There were few major changes by demographic groups, although the unemployment rate among white men fell by 0.3 percentage points to 4.6 percent, while the rate among white women rose by 0.1 percentage point to 4.2 percent, narrowing the gap to 0.4 percentage points.

There was a 0.3 percentage point rise in the unemployment rate for both workers with high school degrees and those with less than a high school degree. The unemployment rate for women who head families rose to 9.0 percent -- 0.7 percentage points above its year ago level.

Other data in the household survey suggested further weakening of the labor market. The number of workers involuntarily working part-time rose by 179,000 and now stands 456,000 above its level in December. The percentage of unemployment attributable to workers who voluntarily leave their jobs fell to 9.1 percent, the lowest since March of 1984. And the number of discouraged workers (people who have given up looking for jobs because of bleak prospects) rose to 450,000, compared to 267,000 in February of 2000.

While the labor market picture in the household survey is not good, it clearly is not as bleak as the job loss shown in the establishment survey. To understand the February plunge, it is probably most helpful to view the gain of 185,000 jobs reported for January as an anomaly.

The rate of job loss for the last three months then averages 90,000, or 88,000 over the last four months. This pace of job loss would typically be associated with a rise of 0.3 percentage points to 0.5 percentage points in the unemployment rate. In fact, the unemployment rate has remained unchanged since October, although the labor force participation rate has fallen by 0.3 percentage points. This is likely to be reflected in higher unemployment rates in the spring.

The Institute for Public Accuracy

(The IPA is a nationwide consortium of policy researchers that seeks to broaden public discourse by gaining media access for experts whose perspectives are often overshadowed by major think tanks and other influential institutions.)

WASHINGTON -- The Iraq U.N. debate

-- Michael Ratner, president of the Center for Constitutional Rights and coauthor of "Against War with Iraq." A resolution with a March 17 deadline is reportedly being put forward to the U.N. Security Council.

"The U.S. government is clearly desperate to get some sort of cover for its war. No one has shown that Iraq is a threat. There's no self-defense here; Bush is just trying to find some sort of cover for naked aggression."

-- Susan Wright, editor of the new book "Biological Warfare and Disarmament: New Problems/New Perspectives."

"That any country could contemplate a war over weapons that have not been found would seem ludicrous if this scenario did not appear so close to happening ... Going to war opens the door to a lawless world -- precisely the world that the United Nations and its Security Council were designed to exclude ..."

-- Rahul Mahajan, author of the book "The New Crusade: America's War Against Terrorism" and the forthcoming book "The U.S. War on Iraq: Myths, Facts, and Lies."

"The administration is resorting to outright falsehoods in its drive for invasion. For example, White House spokesman Ari Fleischer recently said Saddam Hussein 'denied he had these weapons (the al-Samoud 2 missiles), and then he destroys things he says he never had.' But actually Iraq declared those missiles in the Dec. 7 report, and before that in October."

-- Russell Mokhiber, editor of Corporate Crime Reporter, Mokhiber was at the White House news conference Thursday last night.

"Last night's might have been the most controlled presidential news conference in recent memory. Even the president admitted during the news conference that 'this is a scripted' news conference. The president had a list of 17 reporters who he was going to call on. He didn't take any questions from reporters raising their hands. And he refused to call on Helen Thomas, the dean of the White House press corps, who traditionally asks the first question ... "

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