November 2, 2012

The October Employment Situation Summary (110212); Rate up to 7.9%, 171K SA Jobs Added

Filed under: Economy,Taxes & Government — Tom @ 8:29 am

Econ catchup:

  • ADP’s employment report showed 158,000 jobs added in the private sector.
  • Auto sales were up by 6.9% in October over October 2011. Ford was flat, GM was up almost 5%, and Chrysler 10%. Toyota (+15%) and Honda (+22%) led the way.
  • The Institute for Supply Management’s Manufacturing Index rose to 51.7% in October from 51.5% in September, indicating slightly increased expansion. Oddly, new orders went into further expansion but the backlog of orders went further into contraction.

Predictions for today’s report:

  • Bloomberg: 7.9% unemployment rate; 125,000 job additions.
  • Reuters: same (“offering Obama no relief”)
  • I’ve read and heard several predictions that the job adds will be higher than the consensus prediction, but that the unemployment rate will rise to 8.0%.

The report will be here at 8:30.

HERE IT IS:

Total nonfarm payroll employment increased by 171,000 in October, and the unemployment rate was essentially unchanged at 7.9 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in professional and business services, health care, and retail trade.

Household Survey Data

Both the unemployment rate (7.9 percent) and the number of unemployed persons (12.3 million) were essentially unchanged in October, following declines in September.

Among the major worker groups, the unemployment rate for blacks increased to 14.3 percent in October, while the rates for adult men (7.3 percent), adult women (7.2 percent), teenagers (23.7 percent), whites (7.0 percent), and Hispanics (10.0 percent) showed little or no change. The jobless rate for Asians was 4.9 percent in October (not seasonally adjusted), down from 7.3 percent a year earlier.

… The civilian labor force rose by 578,000 to 155.6 million in October, and the labor force participation rate edged up to 63.8 percent. Total employment rose by 410,000 over the month. The employment-population ratio was essentially unchanged at 58.8 percent, following an increase of 0.4 percentage point in September.

Establishment Survey Data

Total nonfarm payroll employment increased by 171,000 in October. Employment growth has averaged 157,000 per month thus far in 2012, about the same as the average monthly gain of 153,000 in 2011. In October, employment rose in professional and business services, health care, and retail trade.

The change in total nonfarm payroll employment for August was revised from +142,000 to +192,000, and the change for September was revised from +114,000 to +148,000.

So 255,000 more people (171K today plus 50K more in August plus 34K more in September) were believed to be working in October than in September. My quick reax is that seasonally adjusted figures reflect the underlying raw (seasonally adjusted) data, but that will require a closer look.

My jump-out stats:

  • Since the recession ended in June 2009, the number of seasonally adjusted full-time workers has only increased by 2.8 million (from 112.747 mil to 115.459 mil). That’s an unimpressive average of 70,000 per month over 40 months.
  • Additionally the number of full-time workers isn’t even back to where it was when Barack Obama took office, declining by 371,000 (115.839 mil then vs. 115,459 mil now.
  • Meanwhile part-time employment since the recession ended is up by 1.182 mil, and is up by 1.372 mil since Obama took office.

There’s no way to spin any of this FT/PT divergence as positive. The only thing one can do, as the press has done during the nearly four years it has unfolded, is to ignore it.

I won’t have time to do much more with this until either late this evening or tomorrow morning. But I believe I’ll be able to look at and clear comments from time to time, so feel free to chime in.

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6 Comments

  1. Call me Mr. Cynic. Team Obama has gone off the “jobs” message in favor of the U-3 rate, so on the “strength” of 80,000 jobs added and a heaping of Heroes of the Election no longer looking for work, the U-3 rate will drop to 7.6%.

    Comment by steveegg — November 2, 2012 @ 8:06 am

  2. Guess the Magic Egg Ball needs some salt and a greased frying pan.

    As Iowahawk noted – “The lowest monthly UE rate under this president > than the highest monthly UE rate under his predecessor. This has never happened before.”

    Comment by steveegg — November 2, 2012 @ 9:15 am

  3. AP spins it:
    http://www.pennlive.com/midstate/index.ssf/2012/11/federal_jobs_report_due_this_m.html
    Now they want to talk workforce participation rate? Let’s do that for his term.

    Comment by Jim — November 2, 2012 @ 10:40 am

  4. http://www.forbes.com/sites/gregorymcneal/2012/10/13/labor-force-participation-under-obama/

    Comment by Jim — November 2, 2012 @ 10:42 am

  5. [...] The October Employment Situation Summary (110212); Rate up to 7.9%, 171K SA Jobs Added [...]

    Pingback by The October Employment Situation Summary (110212); Rate up to 7.9%, 171K SA Jobs Added | PERSUASION IN INK — November 2, 2012 @ 2:03 pm

  6. Regarding the participation rate, last month, I briefly looked at it. Had the rate of the various demographics (16-24, 25-54, 55-64, 65-69, 70+) participation change from September 2002-September 2007 simply continued unaltered by the Great Recession, the September 2012 unemployment rate would have been roughly 9.2%. Had that rate of change merely resumed starting September 2009 (after the Great Recession “ended”), it would have been roughly 8.5%.

    Adding in all 6,587,000 who weren’t part of the labor force but who want a job would yield an unemployment rate of 11.6%, a rate higher than any calculable time (i.e. since January 1994) before March 2009.

    Comment by steveegg — November 2, 2012 @ 3:33 pm

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