The American economy gained 199,000 jobs last month. We need 90,000 new jobs just to keep up with population growth, which means that net job growth clocked in at 109,000 jobs. That's pretty weak, but about half a million people moved from unemployment to employment and the headline unemployment rate fell yet again to 3.9%.
There's other good news, too: Among blue-collar workers, hourly wages were up an annualized 8.5% from November and weekly wages were up 12.2%. Even with inflation running around 7%, that's a nice increase. On the less bright side, wages were flat on a year-over-year basis.
Despite the weak headline jobs number, this is a fairly healthy report. We could still use stronger job creation, but I continue to suspect that we're being fooled by reports of the "Great Resignation" and other things. Once you look at historical trends, it seems to me that we're closer to full employment than we might think. There's still a little ways to go, but only a little.
I keep seeing "Great Resignation" headlines to the effect that millions are quitting their jobs, but the stories never make clear if it's merely that a lot of people are *switching* jobs, or just quitting and staying home (and supporting themselves...how?). Given these unemployment figures, it has to be the former.
More people are retiring early....but it's only by a few %age points for a small section of the labor force.
There are also more "gig-economy" workers, i.e. more deliveries, than pre-pandemic and I'm not sure where they get counted. Still, a small percentage of the workforce. Day-workers numbers are probably bouncing around as Covid surges through different areas, and the weather swings from balmy to frigid across parts of the country. We can do seasonal corrections, but not so much covid corrections to the data.
NFP is having new business creation issues. Probably millions of upward revisions coming to the benchmark revisions over the next 3 years. Just ignore it.
Who would any person familiar with this data series be taking it's initial value super seriously right now given the recent history of major upward revisions?
Something weird has happened to this data set, and it's become quite weird to pretend it is behaving as it used to.
Mainstream news reporting always seems to neglect the "additional" jobs the BLS finally finds a month or two later. This month, they accounted for an additional 141,000 jobs added in October and November. So the report should be that there were 340,000 new jobs added over the past three months. 1,096,000 total jobs added (so far) since October 1st. 6.45 million total over the past 12 months: "This was the most jobs added in a single calendar year ever (6.45 million)" per calculatedriskblog.com. Jobs recovery overall since Covid started in 3/20 is 85% complete.
"On the less bright side, wages were flat on a year-over-year basis."
Is Kevin saying that REAL wages were flat over the past year? Or is he saying something else?
How can wages be up, below the inflation rate, and flat all at the same time?
Kevin pretty much always adjusts for inflation on things like this in my experience.
Could you put a marker or shade the area that's being omitted due to pandemic fluctuations? Were Jun and Jul in 2021 net 0, or also blotted out?
As NealB points out, recent months have seen unprecedented large upward revisions in the jobs numbers. The most plausible explanation I have seen is that the on-time reporting rate is down substantially, attributed to Covid. Whatever algorithms the BLS has to correct for missing data are clearly not working well. But they face the conundrum of nearly every measure used by economists: the measures are crap, but fixing them would render them difficult to compare with historic values. But note that climate scientists developed cross-comparison of historical, scientifically measured temperatures with tree growth rings.
jeff-fisher also noted the recent large corrections.
Crap measures historically; got that. But this is jabberwocking (sf). It's what we do here. Data. Charts. Actuality. BLS = bullshit. Right now it's not so bad. It was worse ten-eleven years ago when our mortgages were in jeopardy. Want to know what happened 20 years ago, Bush was elected by the Supreme Court. And we're worried now about whether democracy will survive. Absent democracy, I doubt that climate has a chance.
Despite the weak headline jobs number, this is a fairly healthy report.
Moreover, if there's anything we've learned since, erm, forever, it's that a single month snapshot will be revised. And then revised again.