On Friday, the Bureau of Labor Statistics released its monthly employment situation report for September.  Below the fold, I've summarized the five survey results that are most important to our middle-class.

First, wages continue to lag behind inflation.  The jobs report calculated wage growth at 2.6% over the last year, which is well behind price increases of about 3.6% to 3.8%.  The soaring costs of gasoline, tuition, and health care are coupled with rising prices for everyday baskets of goods, and the result is that the middle class is sprinting just to stay in place.  

Second, according to some analyses, Hurricane Katrina resulted in the loss of approximately 229,000 jobs.  What's worse is that that figure might actually end up being higher since data collection in the Gulf was compromised by the storm and since some layoffs may still be coming.  On the other hand, the job losses were actually lower than what some analysts predicted, and some economists anticipate that the billions of dollars being poured into the rebuilding effort will actually create an offsetting bump in employment.

Third, after gaining an average of 12,000 jobs per month, the retail industry suffered a sudden loss of 88,000 jobs in September.  Last week, I wrote about planned layoffs at Federated Department stores.  While I would not suggest that there is cause for widespread panic among workers in the retail industry, it is at least disconcerting to see pockets of vulnerability in a sector on which our labor markets have come to rely so heavily over the last ten years.  The prospect of steady employment may have been an offsetting benefit in a retail sector that has traditionally paid relatively low wages.  It would be a shame to see that reliability disappear.  Hopefully, however, the one-month dip in retail employment is a result of Katrina (though the BLS report explicitly suggests otherwise), and the industry will be able to bounce back in October.

Fourth, the economy shed 27,000 manufacturing jobs, bringing the total losses in that sector to 118,000 for the year.  Whereas the dip in retail employment went against general trends for that industry, the loss of more manufacturing jobs is nothing new; since the beginning of 2001, we've lost 2.8 million blue-collar jobs.  The erosion of our manufacturing base is especially problematic given the traditionally high wages and good benefits associated with these jobs.  Exacerbating the difficulties associated with this structural change in our economy is the widespread belief that the skill set required in the manufacturing sector is not readily transferable to other, growing industries.

Finally, one bit of good news that has not received much attention is that the median duration of unemployment fell to 8.6 weeks, down from 9.4 last month.  This indicates that the unemployed are getting back to work more quickly, one sign of a tight labor market.

(Note - The Employment Situation Report figures are preliminary, and often subject to revisions.)