BLS DAILY REPORT, MONDAY, AUGUST 5, 1996: Job growth slows a little in July from the vigorous pace of 1996's second quarter to what analysts say are more sustainable levels (Daily Labor Report, page D-1, E-1). The unemployment rate edged up to 5.4 percent in July and average hourly earnings fell after a strong June surge, the Labor Department reports, calming fears that the economy was overheating and inflation would begin to accelerate. Financial markets reacted jubilantly to the news that the economy created 193,000 new jobs in July. While most analysts called the job growth healthy, it was a little below market expectation and a falloff from June's revised 220,000. __The Washington Post (August 3, page 1) reported that the U.S. economy added an impressive but not excessive 193,000 jobs in July, the latest in a week's worth of economic data that seemed to have good news for just about everyone. The news helped to extend a week-long rally on Wall Street, where both stocks and bonds have recovered all of the ground lost during last month's sharp decline. The report quelled fears that the Fed would raise interest rates this month (page F2). __The New York Times (August 3, page 1) reported that after several months in overdrive, the economy is showing signs of slowing to a more moderate but still healthy pace that is generating no increases in inflation, Government figures indicated. The jobs report, combined with other recent data, confirmed expectations that the Fed would not raise short-term interest rates this month, heartening investors, said The Times. Charts including the BLS news release data are carried on page 37. On page 38 of the August 3 Times, the "Currency Markets" column said that the dollar ended slightly lower yesterday after a July employment report bolstered expectations that United States interest rates would remain steady. __The Wall Street Journal carries the unemployment rate, 1993 to the present, on page 1. On page A2, The Journal says that somewhat subdued job growth and declining hourly wages in July offered the clearest signs yet that the economy is throttling down from the second quarter's torrid pace. The financial markets exhaled on Friday, quickly concluding that the benign employment report takes the pressure off the Fed to raise interest rates at its policy meeting August 20. On page C1, The Journal says that jobs data reinforce bullishness. The House and Senate give their final approval to a 90-cent increase in the minimum wage for some 12 million workers currently earning less than $5.15 an hour, says the Daily Labor Report (page AA-1, AA-3, AA-4). The current minimum wage of $4.25 an hour will increase by 50 cents an hour on October 1, and by 40 cents to $5.15 an hour on September 1, 1997. The measure establishes a permanent subminimum wage of $4.25 an hour for the first 90 days of employment for individuals under 20 years of age. Minimum pay for tipped employees will remain at the current level of $2.13 an hour plus tips. The measure also provides $21.4 billion in business tax breaks through 2006, includes a package of pension revisions, and a provision to tax settlements and court awards in nonphysical injury cases, including employment discrimination suits. __The Washington Post (August 3, page 1) said that medical coverage portability was included in the minimum wage bill in a final flurry. __The New York Times (August 3, page 1) reported that lawmakers, rushing toward a month long recess, resoundingly approved a bill to raise the Federal minimum wage by 90 cents to $5.15 an hour. The Senate August 2 passed a health insurance reform bill that aims to make insurance more affordable by providing a range of tax incentives. The vote cleared the way for the legislation to be signed into law by President Clinton, giving millions of individuals that ability to change jobs without losing their health insurance and limiting insurance companies' ability to reject people because of pre-existing conditions (Daily Labor Report, page A-16). The House had given its own, overwhelming approval August 1. __The Washington Post (August 3, page 1) says passage of the insurance bill offers some peace of mind, but worried families say that reforms are not as sweeping as heralded. In its "Tracking the Economy" feature, The Wall Street Journal says on page A2 that the initial jobless claims figure for the week to August 3 would; be 325.000, according to the technical data consensus forecast, in contrast to the actual 292,000 of the previous period. Producer prices for July, to be released Friday, will rise to 0.2 percent, the same as the June actual percentage. On page A2, The Wall Street Journal says that when President Clinton signs the historic welfare legislation into law, he will also be signing up the states for the unenviable task of finding full-time jobs for 2 million of the least skilled and least employable Americans. The states are in a cold sweat, says The Journal. "I have serious reservations about our ability to meet these requirements," says a top welfare official in Minnesota. "I don't think any state can hit" the target, says one in West Virginia. "People don't realize what an enormous change this is.:
