The analysis below covers the employment table published on the first Friday of each month. Even if most of the attention is on the title, it can be helpful to review the details, reviews, and other reports to get a better idea of what's really going on.
Current trends
The BLS reported a gain of 272,000 jobs, which was higher than expected. However, the trend this year has been a wildly divergent household survey and this has continued again this month. The gap between the household survey and the overall figure was 680,000 jobs! It’s a -150% failure!
Figure: 1 Primary report versus household survey – monthly
Even with the explosive March Households Report (entirely driven by part-time jobs – Figure 6), the Households Report is coming path under the title number. The chart below shows that this trend has been in place for a few years but has completely gone haywire this year. Year-to-date, the overall figure is +1.29 million while the household survey shows a year-to-date figure. loss of 100k.
Figure: 2 Primary Report versus Household Survey – Annual
The BLS also publishes the data underlying its Birth/death assumptions (creation of a new company). In May, the BLS assumed 231,000 jobs added to its birth/death assumptions. This is the second highest percentage of assumptions relative to total gross job gains since December and the third highest in a year.
Figure: 3 Unadjusted primary report with assumptions on stillbirths – Monthly
The annual report paints an even bleaker picture, showing gross employment at 46,000 for the year. Without Birth/Death, this number drops to -557k because Birth/Death compensates for +603k.
Figure: 4 Unadjusted primary report with assumptions on stillbirths – Monthly
Dig into the report
The 272,000 jobs surprised on the upside, but with the unemployment rate up slightly to 4%.
Figure: 5 Evolution by sector
Another level of detail in the household report shows full-time and part-time job holders. While part-time had been in the lead for months, April saw a major reversal where part-time jobs were replaced by full-time jobs. Then, in May, many of those full-time jobs disappeared.
Figure: 6 Full-time and part-time
Jobs by category
A number of categories have seen large improvements over recent averages: manufacturing, professional businesses, and trade/transportation.
Figure: 7 Current vs TTM
The table below shows a detailed breakdown of the figures.
Figure: 8 Detail of the labor market
Revisions
The chart below shows how employment data has been revised over the past few months. The largest revisions have been downward, but there have been some upward revisions.
Figure: 9 revisions
Over the past three months, data has been revised downward by 13k on average per month and 6.2k over 12 months. These revisions go unnoticed by the general public.
Figure: 10 revisions
Historical perspective
The chart below shows data going back to 1955.
Figure: 11 History of the labor market
The labor force participation rate is still well below pre-global financial crisis peaks. This month it remained stable at 62.5%.
Figure: 12 Distribution of the labor market
Conclusion
The overall figures continue to show moderate strength, but the household survey indicates a entirely different story. At some point, one of these two ratios will catch up with the other. It seems likely that the Household Survey will be more accurate and provide a more accurate picture of the labor market.
The data source: https://fred.stlouisfed.org/series/PAYEMS and also the CIVPART series
Data updated: monthly, the first Friday of the month
Last updated: May 2024
Interactive tables and graphs are still available on the Explore finance dashboard: https://exploringfinance.shinyapps.io/USDebt/
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