February 1, 2002 — 2002-02-01

Advance copies of this statement are made available to the press under lock-up conditions with the explicit understanding that the data are embargoed until 8:30 a.m. Eastern Standard Time. I appreciate this opportunity to comment on the labor market data that we released this morning. Nonfarm payroll employment fell by 89,000 in January following job losses that averaged 311,000 a month in the fourth quarter of 2001. Manufacturing and construction employment declined, while services employment was flat. The unemployment rate decreased by two-tenths of a percentage point to 5.6 percent after rising by the same amount in December. Looking in more detail at the data from our survey of employers for January, job losses continued in manufacturing (-89,000), although at the slowest pace since September. The largest decline occurred in transportation equipment (-28,000), as motor vehicle plants had temporary shutdowns and aircraft factories continued to lose jobs. Sizable employment declines also occurred in primary metals, fabricated metals, industrial machinery, and electronic equipment.