From January 1993 to December 1995, an estimated 8.4 million workers were displaced from their jobs, including 3.8 million long-term workers who had held their jobs for at least three years, the bureau said. Displaced workers are defined as people 20 years or older who have lost their jobs because their plant or company closed or moved, their positions or shifts were eliminated or there was insufficient work for them to do.

Of those 8.4 million workers, roughly six million had successfully found new work by February, when the survey was conducted. Some 16% of those workers remained unemployed, however, and 13% had stopped looking for new jobs and left the labor force. By comparison, 67% of workers in the bureau’s last worker-displacement survey, which was conducted in February 1994 and included the 1991 recession, were able to find new work, while 21% were unemployed.

In signs that the labor market has rebounded since then and that the effects of downsizing may have slowed, 618,000 fewer workers lost their jobs from 1993 to 1995 than in the 1994 survey, and displacement among long-term workers fell 15%.

"We’ve created about 10 million new jobs. It’s been a strong, strong labor market recovery," said economist Audrey Freedman, president of Audrey Freedman & Associates in New York.

Since 1993, 44% of displaced workers lost their jobs because of plant closings. Roughly 24% said there was insufficient work, while nearly a third said their jobs were eliminated. Over 56% said they didn’t receive advance notice that they were losing their jobs.

Nearly three out of 10 displaced workers came from the manufacturing sector. But downsizing took its toll among white-collar workers as well, said Joseph E. Stiglitz, chairman of the Council of Economic Advisers.

"White-collar workers represent a much larger share of those displaced. The share of manufacturing, while large, continues to decline," he said.

But it remains easier for laid-off managers and other white-collar workers to find new work. Nearly 80% of managers were in new jobs by February, while only 64% of operators, fabricators and laborers had been rehired. In part that reflects the changing nature of the economy, but analysts have noted that it is easier for white-collar workers to find new jobs because of a greater number of outside contacts and a wider range of skills.

One worrisome trend that surfaced in the survey was that more than half of workers took new jobs that paid them less, including nearly a third who accepted a job that paid them 80% or less of what they previously had been earning. "The steady upward wage movement that was our wonderful future has stalled," Ms. Freedman said.

In a separate report Thursday, the Labor Department said initial claims for state unemployment benefits rose 6,000 last week to 327,000. The four-week moving average, a closely watched barometer of labor-market trends, rose 1,500 to 314,000. The figures are adjusted for seasonal variations.

The stable prices at the producer level offer a further sign that inflation is under control, analysts said. Bonds were up sharply on the news Friday, with the Treasury Department’s benchmark 30-year issue closing Friday at 100 23/32, up 23/32 point.

"It just doesn’t get much better than this," with declining inflation and strong real growth, said Chris Varvares, a forecaster at Macroeconomic Advisers L.L.C. in St. Louis. The producer price index, which tracks price fluctuations at the producer level, and the consumer price index, its retail-level counterpart that will be released Tuesday, help economists to measure inflation.

The report gives the Federal Reserve yet another reason not to raise interest rates at its Aug. 20 meeting, after data earlier this month indicated average wages and factory orders have fallen recently. Indeed, there were few hints of out-of-control growth in July wholesale prices. Energy prices, which have declined for three months in a row, fell 0.9%, though they were offset by a 0.2% increase in food prices. Automobile prices also fell 0.9%. Excluding the volatile food and energy components, producer prices rose 0.1%.

Not only were prices for finished goods unchanged, but those of intermediate materials that need further processing — such as flour, yarn and lumber — fell 0.3%, excluding food and energy. Similarly, prices for raw materials — like cotton and coal — fell 1.6%. Those drops indicate there is little inflation in the pipeline, analysts said. "If you’re looking at the crude prices, there doesn’t seem to be much pressure there at all," Bureau of Labor Statistics economist Scott Sager said. All figures were seasonally adjusted.

The index’s rise was its fifth in a row, including a 0.3% gain in April and a 0.2% gain in May. Three consecutive increases usually signal that the economy is expanding.

"The economy is on the move again, but the speed of the expansion is uncertain," said Robert Dederick, chief economist at Northern Trust Co. in Chicago.

The index of leading indicators is intended to predict economic activity six to nine months ahead, but many economists say it more accurately reflects current economic conditions. While it is useful for forecasting whether the economy will grow or contract, the index doesn’t indicate the rate at which changes will occur.

For those reasons, analysts said, Monday’s report offered little to resolve their concern about whether the second quarter’s sizzling economic growth will continue in the second half. Federal Reserve Chairman Alan Greenspan warned last month that the economy may be growing too quickly, leading to speculation that the Fed will raise interest rates at its monetary-policy meeting Aug. 20.

But reports of rising unemployment and declining wages released Friday strongly suggest that growth in the third quarter will be more moderate, analysts said.

June’s decline partially unraveled the huge 4.2% jump in May orders. That gain was just one piece of economic data in the robustly healthy second quarter that caused financial markets to wonder if the economy was in danger of overheating.

But June’s report helped temper that fear a bit. Treasurys ended modestly higher Thursday, with the bellwether 30-year bond rising nearly 3/8 to yield 7.01%.

More than half of the June decline in orders for durable goods, or big-ticket items such as appliances and automobiles expected to last more than three years, came from a plunge in new aircraft bookings. That was partly offset by a 31.6% increase in defense orders. Stripping out the volatile defense and aircraft sectors, total new orders rose 1.3% in June.

Although the manufacturing sector has shown erratic results month-to-month during the second quarter, overall orders have grown faster than they did a year earlier. "The basic trend is that orders are increasing gradually, with bouncing along the way," said economist Richard Rippe of Prudential Securities.

While new orders fell in June, unfilled orders increased for the second month in a row, suggesting that manufacturing activity will continue to be solid as factories work to keep up with demand, analysts said.

Economist James Annable of First National Bank of Chicago said the report indicates that the economy has finally completed corrections for inventory rebuilding, the General Motors Corp. strike that hobbled auto production and brutal winter weather in the first quarter. "We’re getting a regression back to moderate growth," he said.

Analysts are closely watching for signs of a slowdown. In recent days, Federal Reserve Chairman Alan Greenspan has said policy makers will be monitoring even the smallest changes in the economy to gauge whether growth is easing. Moderation of growth would make it less likely that the Fed would raise interest rates at its meeting next month.

But the government’s durable-goods report tends to be "so erratic" that a June decline in orders alone probably won’t do much to convince the Fed of a slowdown, said David Orr, an economist at First Union Corp. in Charlotte, N.C. The Fed chief "says he needs persuasive evidence. This is not persuasive evidence," Mr. Orr said.

Next week’s economic data will be much more important to the Fed. That’s when the government releases its first estimate of second-quarter growth, the July employment report, and the quarterly cost-wage index.

Separately, the Labor Department said Thursday that first-time unemployment claims dropped by a surprising 45,000 to 322,000 last week. Although some of the decline may be due to auto manufacturers beginning production of 1997 models, the data may suggest an improved employment picture, analysts said.

The four-week moving average of jobless claims, considered to be a better barometer of labor-market health, fell by 8,000 to 352,000 claims.

"We’re hot as fire down here," he drawls. "It’s not the best it’s ever been, but it’s pretty dang close."

Defying predictions, American consumers continue to open their wallets — and fuel economic growth. Economists say businesses let their inventories dwindle early this year and then were surprised by consumers’ resilience. But now, as they rush to restock their shelves, economic growth could pick up in the current quarter — with much of the spending coming from affluent Americans enjoying the dual benefits of rising incomes and gains in mutual-fund investments.

You can see evidence of economic growth in the cars streaming into Mr. Helfman’s dealership from Chrysler Corp.’s Sterling Heights plant, near Detroit. The plant recently added Saturdays to its production schedule "to keep up with demand," says Dick Entenmann, its manager. Even hotter is Chrysler’s minivan plant in nearby Windsor, Ontario, now up to three shifts and turning out 1,450 units a day. "The lights never go out around here," says manager Adrian Vido, though he has to allow half an hour between shifts for workers to get in and out of parking lots.

Chrysler’s growth is leading the industry at the moment; its May sales were up 17% from a year earlier. For the industry as a whole, auto sales by domestic producers rose 7% from May 1995. Chrysler economist Van Bussmann says the industry, long prone to boom-and-bust cycles, will rack up its third year of strong sales this year. "We haven’t had three years of back-to-back steady sales for at least 50 years," he says.

All this activity on Main Street, of course, is making Wall Street nervous. Bond-market experts fear that when the economy gets hot, inflation heats up, too. So, they are watching closely for any hints of excessive strength in the government’s employment report coming out Friday. Strong job growth, they fear, could lead the Federal Reserve to raise interest rates in an effort to head off inflation, and fixed-income securities would suffer.

Right now, there is little evidence of strong growth fueling inflation. Materials costs are stable, and businesses say they have little pricing power. "It is becoming increasingly difficult to pass on higher prices," says Nolan Archibald, chief executive of Black & Decker Corp., the Towson, Md., toolmaker. With foreign competition intense, "you just have to absorb any price increases on the raw-material side."

Wage increases remain modest as well. In 26 states, unemployment is below 5% — a level that in the past has pushed wages higher. Yet even in those states, employers seem to find creative ways of hiring enough workers without raising wages. In Minnesota, with a 3.1% unemployment rate, for example, the Minneapolis bus authority cut its drivers’ minimum age to 19 from 21 to fill jobs. The first to be hired, 19-year-old Kari Kuntz, seems a little out of place among the burly men in the drivers’ lounge of the bus garage. She says most passengers don’t ask about her age, though some inquire about her long, purple-tinted hair.

William J. Hudson, chief executive of AMP Inc., a $5.5 billion maker of electronic components with 40 factories in the U.S., says he isn’t having any trouble filling jobs. He is raising wages by a moderate 3.5% this year, "but we are more than making up for that in higher productivity." Meanwhile, his prices are falling an average of 4% a year, largely because of foreign competition.

The Fed isn’t at all likely to raise interest rates at its July 3 meeting despite the bond market’s fears. In interviews, some Fed officials express concern about a first-quarter uptick in wages, but they note that that rise was offset by lower employee benefits. And they see scant other signs of strain in the economy; they note, for instance, few worrisome shortages of materials. One of Chairman Alan Greenspan’s favorite indicators, lead times for parts and materials deliveries, has been little changed for a few months, giving no hint of the bottlenecks that could force up inflation.

"We are in a strong quarter," a fact that will require the central bank to be especially vigilant for inflationary signs, says Fed Governor Janet Yellen. But she adds, "The underlying trend is for balanced growth" and expects the second half to slow a bit from the current pace.

For President Clinton, the economy could hardly be better; in some ways, it is in its best shape in a generation. Although a flare-up in inflation or surge in interest rates could change things quickly, the economy’s current resilience is helping fuel Mr. Clinton’s popularity in the opinion polls. The so-called misery index — the combination of inflation and unemployment that helped sink President Carter’s bid for re-election — is at its lowest level in decades. Inflation has stayed below 3% for more than three years, and unemployment below 6% for nearly two years. However, wage stagnation remains a serious and confounding problem for people who lack a college education.

What could go wrong? For one thing, the economy’s moderate strength isn’t uniform. California is finally emerging from a long slump, which lingered on well after the national recession lifted in 1991. But unemployment there remains at a painful 7.5%, second only to West Virginia’s. New York and New Jersey, too, are lagging behind in economic growth.

There’s also the possibility that inflation will pop up, forcing the Fed to act later this summer. A single strong quarter isn’t likely to cause policy makers to slam on the brakes; nor is it likely that a small rise in rates would sharply slow the economy. But if there are signs of an inflationary spike, the outlook could change.

And the stock market might drop. Economists think one explanation for the strength of housing and auto sales might be the "wealth effect": Households flush with gains on stocks or mutual funds are more likely to buy big-ticket items. But if those gains in wealth evaporate in a sudden slump in the market, it could affect consumer spending in a way that it never has before, says economist Henry Kaufman. A bigger slice of household assets is in the stock market now than before the 1987 crash; so, a plunge could hit consumer sentiment far harder. "There’s no precedent for this," Mr. Kaufman says.

But for now, it’s steady as she goes. "It’s not too hot, and it’s not too cold," Chrysler’s Mr. Bussmann says.

Mr. Bussmann’s favorite consumer-spending barometer is a measure of real disposable income per household — income after taxes and inflation, divided by the number of households. In March, disposable household income was 1.8% above a year earlier. "It’s been running in that range for a couple of years," he says. "Steady, sustained growth — nothing that would lead to a buying binge," but enough to keep people buying plenty of Chryslers.

The consumer’s strength is evident in government statistics that show overall consumer spending soared in the first quarter to a two-year high. Retailing, after suffering during the winter, is picking up, with high-end merchants doing especially well. At Neiman-Marcus Group Inc., for example, $1,000 suits are flying off the racks, says Kelly Patrick, a spokeswoman. Among even bigger-ticket items, luxury-yacht sales are booming: Kadey Krogen Yachts Inc., a Miami maker of boats that start at $350,000, says business is so good that its production is sold out for a year.

Even the limousine business is rolling along. "Compared to last year, our business is booming," says Ari Kazmi, manager of All City Limousine in Burlingame, Calif. But he says competition is fierce, keeping prices down. The wedding season is just getting under way, he says, and he has been booking more bachelor and bachelorette parties this year.

Consumers are snapping up outdoor products, despite bad weather in much of the country. Black & Decker’s Mr. Archibald reports strong sales for every product category in his outdoor division, led by the Hedge Hog, a cordless hedge trimmer. Cordless lawn mowers, which, at $350 or more, cost far more than conventional models, are roaring, he adds.

In manufacturing, a slow first quarter is giving way to hopes of a stronger year ahead. AMP’s Mr. Hudson says the economy "isn’t exactly ebullient, but it’s not sick." His company, which makes parts for scores of industries ranging from computers to cars, is budgeting for a stronger second half now that inventories, which were too big last year, are down and demand has steadied.

The rise in interest rates over the past three months may slow parts of the economy later this year, of course. But right now, housing sales are still showing unexpected strength. In the latest report, for April, new-home sales shot up 28% from the slow pace a year earlier. But many in the business say the second half will slow, reflecting higher mortgage rates, which now stand at 8.3%.

The slowing trend is clear in northern Montgomery County, Md., outside Washington. Its rolling hills are full of new homes for sale, mostly priced above $250,000. Rob Bolton, a salesman for Virginia-based Ryan Homes Inc., recalls that in some weeks earlier this year he would have one customer in the office and three more waiting to talk to him in the model home nearby. Now, things are starting to slow.

"Sales are pretty steady, but they are way down from February, March and April," he says. "It’s been a pretty successful year so far, but the amount of traffic I see up here is really directly affected by higher interest rates." Indeed, some large builders are beginning to talk about slippage in building contracts and even some outright cancellations.

Moreover, many Americans, in spite of the favorable macroeconomic trends, still feel discouraged by the stagnation of wages that affects many less-educated workers, and by continued corporate layoffs. "In the face of all this seemingly good news, a sense persists that something is fundamentally wrong," Mr. Greenspan said Wednesday at an economic conference on Cape Cod, Mass. "I refer to the pervasiveness of job insecurity in the context of an economic recovery that has been running for more than five years, inflation that has been contained, and a layoff rate that is historically quite low."

The Fed chairman also suggested Wednesday that this insecurity is rooted in a "rare, perhaps once-in-a-century event — a structural technological advance." The rapid changes in technology, he said, have created a world in which ideas and education are now the dominant element in creating economic value. This, in turn, can be threatening to people unready or unwilling to embrace it. "A new world is emerging," he said.

Factory orders fell slightly because reduced demand for aircraft and defense goods offset moderate gains in other sectors, the Commerce Department reported. The April decline followed a revised 1.7% increase in March, previously reported as a 1.5% gain.

Analysts had predicted a greater decline in April after the Commerce Department announced last week that durable-goods orders, such as for major appliances and automobiles, fell 1.9% in April. But orders for nondurable goods rose 2% for the month, offsetting that result.

The downturn in durable-goods orders mostly reflects erratic month-to-month demand for civilian aircraft. Although auto sales rebounded in April following the General Motors Corp. auto-parts strike, overall orders for transportation goods dropped 12.8% after a 14.6% increase in March.

Excluding that sector, new orders for other items rose 1.9% in April. Those gains indicate a slowly rebounding manufacturing sector, said Robert Dederick, chief economist at Northern Trust Co. "The manufacturing sector has been the drag on the economy," he said. "That stage is really behind us."

Factory inventories were unchanged, and unfilled orders fell 0.2%. The completion of several months of inventory correction indicates continued short-term growth, analysts said.

"This picture is very, very consistent with an economy that was depressed by an inventory adjustment and is working its way out of it," said James Annable, the chief economist at First National Bank of Chicago. "But it will continue to be hampered into the second half of the year."

The industrial sector will continue to produce erratic results but is experiencing a general pickup in activity, said Richard D. Rippe, senior vice president and chief economist at Prudential Securities.

"Business is gradually improving," he said. "It’s not a picture of sharp or robust growth."