September 5, 2014

August Employment Situation Summary (090514): MALAISE — 141K Jobs Added, Unemployment Rate Drops to 6.1 Percent, Participation Percentages at or Near All-Time Lows

Filed under: Economy,Taxes & Government — Tom @ 7:10 am

Econ catchup:

Predictions:

  • Yesterday, the Associated Press carried a prediction of 220,000 jobs gained, with an unemployment rate drop to 6.1 percent.
  • Bloomberg — “Payrolls, jobless rate: The median forecast in a Bloomberg survey of economists projects 230,000 workers were added last month after a 209,000 increase in July. Such a gain would match this year’s average and, if sustained, would make 2014 the strongest in 15 years. The jobless rate is forecast to fall to 6.1 percent in August from 6.2 percent.”

Not Seasonally Adjusted Benchmarks

Here’s the history of the raw and seasonally adjusted data (000s omitted):

NSAandSAestabJobs0100to0714

In light of the above, today’s benchmarks for legitimately impressive job-market performance — a performance which would bring us to “full employment” well before the completely unacceptable prediction of December 2016 cited yesterday in the ADP conference call — would be 475,000 jobs added overall, with 250,000 added in the private sector. Those results would probably yield seasonally adjusted results in the 275K-300K range.

Raw job adds overall appear to be on an upward trajectory during the past three years, likely because the payroll period containing the 12th of August (this year being the week ending August 15) is includes more and more school personnel who are returning to their classrooms and offices earlier each year.

The report will be here at 8:30.

HERE IT IS (permanent full HTML link) — Whoa:

Total nonfarm payroll employment increased by 142,000 in August, and the unemployment rate was little changed at 6.1 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services and in health care.

Household Survey Data

In August, both the unemployment rate (6.1 percent) and the number of unemployed persons (9.6 million) changed little. Over the year, the unemployment rate and the number of unemployed persons were down by 1.1 percentage points and 1.7 million, respectively.

Among the major worker groups, the unemployment rates in August showed little or no change for adult men (5.7 percent), adult women (5.7 percent), teenagers (19.6 percent), whites (5.3 percent), blacks (11.4 percent), and Hispanics (7.5 percent). The jobless rate for Asians was 4.5 percent (not seasonally adjusted), little
changed from a year earlier.

… The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed in August at 7.3 million. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

… Establishment Survey Data

Total nonfarm payroll employment increased by 142,000 in August, compared with an average monthly gain of 212,000 over the prior 12 months. In August, job growth occurred in professional and business services and in health care.

Professional and business services added 47,000 jobs in August and has added 639,000 over the past year. In August, management of companies and enterprises gained 8,000 jobs. Employment continued to trend up over the month in administrative and support services (+23,000), architectural and engineering services (+3,000), and in management and technical consulting services (+3,000).

… In August, retail trade employment was little changed (-8,000). Food and beverage stores lost 17,000 jobs; this industry was impacted by employment disruptions at a grocery store chain in New England. Elsewhere in retail trade, automobile dealers added 5,000 jobs.

… The change in total nonfarm payroll employment for June was revised from +298,000 to +267,000, and the change for July was revised from +209,000 to +212,000. With these revisions, employment gains in June and July combined were 28,000 less than previously reported.

Including prior-month changes, only 114,000 more people were working at payroll jobs in Auguat than in July (142K minus the -31K revision to June plus the +3K revision to July).

Not seasonally adjusted benchmark results —
- Total Nonfarm: 327K jobs added vs. 475K benchmark.
- Private-sector: 118K jobs added vs. 250K benchmark.

Not good at all.

Observations:

  • The malaise continues: The workforce shrunk by a seasonally adjusted 64K. Not in labor force: a record 92.27 million.
  • Part-timers were down by 327K, while full-timers were up by 127K. That implies a Household Survey loss of 200K, but the topside change is +16K. Isn’t seasonalization great?
  • I guess BLS has decided that talking about temps in their report is a bad idea, because the 13K jobs added there was noteworthy, but was ignored.
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3 Comments

  1. I have but one word to describe the end of Wreckovery Summer 6.0 – OOPS!

    Comment by steveegg — September 5, 2014 @ 8:34 am

  2. A couple more quick items (from the not-seasonally-adjusted side of the equation):

    - The 63.0% LFPR is the weakest August since August 1976′s 62.7%.
    - The 59.1% employment-population ratio is, other than August 1982 (58.7%), the weakest August between August 1977 (58.9%) and August 2010 (58.8%).

    Jimmy Carter called and he wants his stagflation back.

    Comment by steveegg — September 5, 2014 @ 8:43 am

  3. In related news:

    San Diego Minimum Wage Petition Battle

    http://legalinsurrection.com/2014/09/san-diego-minimum-wage-petition-battle/

    Excellent video on the effects of a minimum wage increase.

    Comment by dscott — September 6, 2014 @ 11:38 am

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