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Regional nonfarm wages and salaries thus far in the recovery.

From the fourth quarter of 1982, the trough quarter of the most recent national recession, to the fourth quarter of 1983, the most recent quarter for which estimates of regional personal income are available, nonfarm wage and salary disbursements (payrolls) increased at rates more than the national average in the New England, Southeast, Far West, and Great Lakes regions and less than the national average in the Mideast, southwest, Plains, and Rocky Mountain regions. Each of the regions with above-average increase in nonfarm payrolls had large increases in durables manufacturing payrolls. Each of the regions with below-average increases in nonfarm payrolls had small increases in nondurables manufacturing payrolls and, except for the Plains, in mining payrolls; in addition, the Mideast and Southwest regions had small increases in durables manufacturing payrolls. Thus far in the recovery, nonfarm payrolls increased 8.3 percent in the Nation and at least 5.2 percent in each of the eight BEA regions. The first row of table 1 shows, for the Nation, the percent change in nonfarm payrolls by industry. Durables manufacturing, the finance group (finance, insurance, and real estate), services, and construction had large increases. The increases in durables manufacturing payrolls mainly reflected a rebound in motor vehicles production. Durables manufacturing industries that supply the motor vehicles industry, such as fabricated metals, also had large increases in production. The increase in construction payrolls mainly reflected a rebound in residential construction. Durables manufacturing industries that supply residential construction, such as lumber and other building materials and household equipment, also had large increases in production. The increase in the finance group in part reflected the rebound in residential construction. The smallest increases were in Federal government and mining payrolls. The weakness in mining mainly reflected a large decline in oil exploration, as oil prices declined.

Table 1 shows, for each of the eight BEA regions, the percent change in nonfarm payrolls by industry. The paragraphs that follow discuss regional percent changes by industry, and the weights, that is, the shares of regional nonfarm payrolls accounted for by the industries (table 2). The regional percent changes are discussed in descending order.

In New England, the above-average increase in nonfarm payrolls was mainly accounted for by construction, trade, and durables manufacturing. Payroll increases in both construction and trade were larger than in any other region. Within trade, strength in sales of furniture and household equipment reflected strength in residential construction. Within durables manufacturing, electrical machinery and fabricated metals had large weights and large increases in production.

In the Southeast, the above-average increase in nonfarm payrolls was mainly accounted for by both durables and nondurables manufacturing, construction, and the finance group. An increase in durables manufacturing payrolls was larger than in any other region except the Great Lakes. Durables manufacturing industries that supply the motor vehicles and residential construction industries had large weights and large increases in production. Both the increase in nondurables manufacturing payrolls in the Southeast and the industry's weight were larger than in any other region. Within nondurables manufacturing, textiles, as well as rubber and plastics, had large weights and large increases in production.

In the Far West, the above-average increase in nonfarm payrolls was mainly accounted for by both durables and nondurables manufacturing, trade, and the finance group. Within durables manufacturing, electronic components, fabricated metals, and lumber had large weights and large increases in production. The increase in trade payrolls in the Far West was larger than in any other region except New-England.

In the Great Lakes region, the above-average increase in nonfarm payroll was mainly accounted for by durables manufacturing, as production of motor vehicles rebounded. Both the increase in durables manufacturing payrolls and the industry's weight were larger than in any other region. Within durables manufacturing, the motor vehicles industry and industries that supply it had large weights and large increases in production.

In the Mideast, the below-average increase in nonfarm payrolls was mainly accounted for by both durables and nondurables manufacturing and the transportation group. Within durables manufacturing nonelectrical machinery, instruments, and steel had large weights and small increases in production. In contrast with a large increase in steel production nationally, steel production in the Mideast increased moderately. Within nondurables manufacturing, printing and publishing had a large weight and a small increase in production.

In the Southwest, the below-average increase in nonfarm payrolls was mainly accounted for by mining, both durables and nondurables manufacturing, construction, and trade. Weakness in mining payrolls reflected a large decline in oil exploration, as oil prices declined. The increase in durables manufacturing payrolls was smaller than in any other region. Within durables manufacturing, industries that produce oil field equipment had large weights and small increases in production. Within nondurables manufacturing, petroleum refining had a large weight and a small increase in production. Within trade, purchases by Mexicans in Southwest counties bordering Mexico declined because of that country's debt crisis and resulting currency devaluation.

In the Plains, the below-average increase in nonfarm payrolls was mainly accounted for by nondurables manufacturing, trade, services, and the finance group. Small payroll increases in these industries mainly reflected a large decline in farm income, in part because of a drought. Within nondurables manufacturing, food processing had a large, weight and a small increase in production. The increase in trade payrolls was smaller than in any other region.

In the Rocky Mountain region, the below-average increase in nonfarm payrolls was mainly accounted for by mining, construction, and the finance group. As in the Southwest, weakness in mining payrolls reflected a large decline in oil exploration, as oil prices declined. Payrolls declined in construction and, in part reflecting this, the payroll increase in the finance group was small.
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Author:Bretzfelder, Robert; Friedenberg, Howard
Publication:Survey of Current Business
Date:Apr 1, 1984
Words:944
Previous Article:Federal budget developments.
Next Article:County and metropolitan area personal income, 1980-82.
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