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Record Number at Work; Jobless Rate Declines

March 09, 1985|TOM REDBURN | Times Staff Writer

WASHINGTON — The overall unemployment rate edged down in February to 7.2% from 7.3%, the Labor Department reported Friday, pushing the number of civilian jobholders to a record 106.7 million.

White House spokesman Larry Speakes called the unemployment drop "reassuring" and pointed to a number of "positive economic indicators" that he said formed the "ingredients for a promising economic future."

But Rep. David R. Obey (D-Wis.), chairman of the congressional Joint Economic Committee, noted that the unemployment rate has remained relatively unchanged for the last 10 months and said the economy is "making no new progress for (those) who want work but cannot find it."

300,000 More Jobs

The economy added 300,000 jobs in February, the Labor Department said, but, because of an increase in the labor force, the number of unemployed persons fell by just 85,000, to a total of 8.4 million.

Nevertheless, the proportion of the adult population at work matched the record high of 60.1% set in December, 1979.

In California, the unemployment rate plunged to 6.7% from 7.3%, but some economists cautioned that the drop may have been exaggerated because the Labor Department's survey showed an unusual decline in the civilian labor force instead of the normal increase.

The jobless rate in the Los Angeles metropolitan area also dropped considerably, from an unadjusted 8% rate in January to 6.7% last month. A seasonal adjustment by First Interstate Bank showed that the decline was a more modest but still significant drop to 6.7% from 7.6%. (The Labor Department does not seasonally adjust regional unemployment figures.)

Figures for San Diego and Orange County are released every other month and were unavailable for February.

The nationwide unemployment rate has changed only slightly since last May, when it hit 7.4% after falling rapidly during the previous year and a half from a peak of 10.6% in December, 1982. Since then, the rate has stayed between 7% and 7.4%.

Civilian Rate Down

The civilian unemployment rate, which excludes members of the armed forces from the labor force, also dropped by 0.1 of a percentage point in February, to 7.3%.

The relatively high plateau of unemployment worries some economists, who fear that economic growth may not make much of a further dent in the jobless rate. "We expect the economy to continue to grow this year," said John O. Wilson, chief economist at Bank of America in San Francisco. "But we don't see unemployment changing much. A 7% unemployment rate may be the best we can do in this economic cycle."

And Sar Levitan, a labor analyst at George Washington University here, warned that the economy "appears to be stuck on an unemployment rate between 7% and 7.5% even in the third year of recovery. In the past, we used to think of that as unacceptably high."

Longer Unemployment

The average duration of unemployment, after falling almost without interruption since early 1983, crept up to 15.9 weeks in February from 15.3 weeks in January. The number of unemployed who have been without a job for six months or more remained steady at 1.3 million.

Long-term unemployment--a measure of those who have been out of work at least 15 weeks--was up a notch to 2.1%.

Thousands of jobless persons face a cutoff of government unemployment benefits next month unless Congress acts to continue supplemental compensation, which adds an extra 13 weeks of jobless pay to the normal maximum 26 week of benefits. The program, now benefiting about 320,000 persons, is authorized only through March.

The gains in employment last month were concentrated among women and teen-agers, but adult blacks lost ground. The unemployment rate for women fell to 6.7% from 6.8%; the jobless rate for teen-agers fell by half a percentage point to 18.4%. But unemployment among blacks, a rate that fluctuates widely because of the relatively small sample surveyed by the department, jumped to 16.3% last month from 14.9% in January.

Service Industry Jobs

The new jobs created last month were mostly in service industries such as retailing, insurance, real estate and finance. Employment in manufacturing fell by 136,000.

Factory workers lost 75,000 jobs in February, with 25,000 of those in the auto industry. Construction workers, affected by bad weather last month, lost 50,000 jobs.

Some analysts suggested that the decline in manufacturing jobs is unlikely to be reversed even as the economy continues to grow.

"Employment gains are still steady, but we're faced with a mutation of the normal process of evolution for an industrial economy," said Roger Brimmer, a top economist at Data Resources Inc. in Lexington, Mass. "Import competition because of the strong dollar and our trade deficit (have) cost us, we estimate, 1.5 million jobs in manufacturing."

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