Jobs: A Weak Report is Even Weaker in the Details
The analysis below covers the Employment picture released on the first Friday of every month. While most of the attention goes to the headline number, it can be helpful to look at the details, revisions, and other reports to get a better gauge of what is really going on.
Current Trends
The BLS reported a gain of 114k jobs which was well below expectations of 185k. Even with the miss, the Headline report was still well above the Household Survey of 67k which was 58.8% of the Headline number.
Figure: 1 Primary Report vs Household Survey – Monthly
This has been the trend for all of 2024 as shown in the chart below. For the year, the Headline Report has shown 1.4M new jobs with the Household Survey showing a mere 83k jobs, or 5.8%. An astronomical miss!
Figure: 2 Primary Report vs Household Survey – Annual
The BLS also publishes the data behind their Birth/Death assumptions (formation of new business). In July, the BLS assumed 246k jobs added in their birth/death assumptions vs a loss of 1.16M for all other jobs (not seasonally adjusted).
Figure: 3 Primary Unadjusted Report With Birth Death Assumptions – Monthly
The annual view shows that birth/death assumptions are positive while the economy has actually experienced job losses according to the raw numbers. It’s not until they seasonally adjust the numbers that it all turns positive.
Figure: 4 Primary Unadjusted Report With Birth Death Assumptions – Monthly
Digging Into the Report
The 114k jobs was accompanied by an unemployment rate rising to 4.3%, a pretty big surge over the last several months.
Figure: 5 Change by sector
The number of multiple job holders has surged to new all-time highs this month.
Figure: 6 Multiple Full Time Employees
Another level of detail in the Household report shows full-time vs part-time job holders. In July, there was a large change with Part-Time converting to Full-Time. Something that has not happened much over the last 18 months.
Figure: 7 Full Time vs Part Time
Jobs by Category
Almost every job category was at or below the 12-month trend.
Figure: 8 Current vs TTM
The table below shows a detailed breakdown of the numbers.
Figure: 9 Labor Market Detail
Revisions
The chart below shows how the jobs data has been revised in recent months. There have been significant downward revisions since January of this year.
Figure: 10 Revisions
Over the last three months, the data has been revised down by an average of 29.7k per month and 17k over 12 months. These revisions go unnoticed by the mainstream.
Figure: 11 Revisions
Historical Perspective
The chart below shows data going back to 1955.
Figure: 12 Historical Labor Market
The labor force participation rate is still well below the highs before the Global Financial Crisis. This month it rose slightly to 62.7%.
Figure: 13 Labor Market Distribution
Conclusion
The Headline number came in very weak this month, but the Household Survey was even weaker. The Headline number appears to be held up by assumed business creations and multiple job holders. Neither should give anyone much confidence in the numbers being published, not to mention the massive downward revisions in nearly every month this year. This was an all-around bad jobs report!
Data Source: https://fred.stlouisfed.org/series/PAYEMS and also series CIVPART
Data Updated: Monthly on first Friday of the month
Last Updated: Jul 2024
Interactive charts and graphs can always be found on the Exploring Finance dashboard: https://exploringfinance.shinyapps.io/USDebt/
