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Maybe job growth isn’t as great as we think

I've mentioned this before, but the divergence between the establishment and household surveys of employment has continued to grow:

Over the past six months, the establishment survey says that employment has grown by 2.1 million, or 350,000 per month. This is the headline number reported every month.

Conversely, the household survey says that employment has grown by 0.4 million, or 70,000 per month.

The absolute level of employment is not at issue here. The household survey uses a broader definition of employment and is always higher than the establishment survey. However, the growth rate of the two is generally about the same, as you'd expect.

Except for now. Over the past six months the household survey shows a far slower rate of employment growth than the establishment survey. If it's the more accurate one at the moment it would explain a lot of the weirdness of the recent economy, which seems to have mediocre overall performance but gangbusters job growth. Maybe there's no mystery at all, though. Maybe everything is pretty mediocre right now.

7 thoughts on “Maybe job growth isn’t as great as we think

  1. memyselfandi

    "If it's the more accurate one at the moment" That ignores that at least since the Reagan administration the household survey hasn't been worth the paper it's printed on. It should have long been regulated to the ash heap of history.

  2. Austin

    Is it just me, or do the two lines look like they’re converging, not diverging in 2022?

    Over the whole series, they look pretty parallel to me too.

  3. zaphod

    I am still seething about Kevin's post a few days ago equating concern about climate change the conceivable end of American democracy with Christian Armageddon prophecies and desires. So I interrupt the currently scheduled program for this public service announcement.

    https://www.washingtonpost.com/magazine/2022/10/10/country-after-second-trump-term/

    Seems that even some in the mainstream media are less inclined to false equivalence than Kevin. From the beginning of the article:

    "To help game out the consequences of another Trump administration, I turned to 21 experts in the presidency, political science, public administration, the military, intelligence, foreign affairs, economics and civil rights. They sketched chillingly plausible chains of potential actions and reactions that could unravel the nation. “I think it would be the end of the republic,” says Princeton University professor Sean Wilentz, one of the historians President Biden consulted in August about America’s teetering democracy. “It would be a kind of overthrow from within. … It would be a coup of the way we’ve always understood America.”"

    "The message of prophets of democratic doom can sound over-the-top, but to dismiss it, experts say, would be naive."

    1. Austin

      Orange County will be fine no matter what: they have enough money for at least the current Boomer and Gen X middle to upper classes to maintain their comfortable suburban lifestyles. After that, well, it's very American to simply not care about what happens to everyone else. In that regard, Kevin does exhibit a bit more empathy than the average Orange County resident.

      1. zaphod

        Yeah, I guess you are right. "Kevin does exhibit a bit more empathy than the average Orange County resident." Maybe even a bit more empathy than the average American. Sometimes.

  4. roblee1961

    Just a technical note on the comparison between the establishment vs household surveys. The standard error of the household survey is about 400k, while the standard error for the establishment survey is about 100k. So for shorter term analysis, the establishment survey has been more accurate. This isn't to say it isn't useful, as it provides important information on trends such as participation rates as well as unemployment. It's probably best to view them in concert - not unlike GDI & GDP

  5. golack

    so, household survey closer to U6???
    One would hope, even if wages do not climb, people are moving to jobs with benefits, e.g. health care and maybe even retirement (ok, 401K).

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