Jobs: QCEW and Household Survey Continue to Show a Weak Labor Market
The analysis below covers the Employment picture released on the first Friday of every month. While most of the attention goes to the Headline Report, 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
Last month we discussed the catchup in the household survey to the headline report, explaining that it was a one-time event that doesn’t really change the overall picture.
This month, things returned to normal with the Household Survey dramatically underperforming the Headline Report yet again. The Household Survey reported a drop in jobs by 588k while the Headline Report showed a gain of 150k. This is a massive divergence that we saw all last year.
Figure: 1 Primary Report vs Household Survey – Monthly
For the year, the Household Survey is still higher but that is due only to the data anomaly in January.
Figure: 2 Primary Report vs Household Survey – Annual
Switching to the headline report…
The BLS publishes the data behind their Birth/Death assumptions (formation of new business). In February, there was a very minor increase in jobs from new business.
Figure: 3 Primary Unadjusted Report With Birth Death Assumptions – Monthly
For the year, the birth death is now neutral.
Figure: 4 Primary Unadjusted Report With Birth Death Assumptions – Monthly
There is another report published by the BLS called the Quarterly Census of Employment and Wages (QCEW). According to the BLS, this is a far more accurate and rigorous report covering 95% of jobs available at a highly detailed level. Due to the rigor, the report is released quarterly on a several month lag.
The latest report shows a big miss in July followed by above average numbers in August and September.
Figure: 5 Primary Report vs QCEW – Yearly
Through Q3 2025, the QCEW is showing much weaker job gains than the Headline Report.
Figure: 6 Primary Report vs QCEW – Yearly
Digging Into the Headline Report
The 151k jobs number was accompanied by an increase in unemployment rate to 4.1%.
Figure: 7 Change by sector
Jobs by Category
When looking over the last 12-month trend, this month was a mixed picture. Note that government hiring is still net positive.
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. The last three months show a net positive mild revision.
Figure: 10 Revisions
Over the last twelve months, jobs have been revised down by about 20k per month.
Figure: 11 Revisions
More Detail in the Household Survey
Another level of detail in the Household report shows full-time vs part-time job holders. This month showed a massive drop in full-time employment.
Figure: 12 Full Time vs Part Time
Historical Perspective
The chart below shows data going back to 1955.
Figure: 13 Historical Labor Market
The labor force participation rate is still well below the highs before the Global Financial Crisis. This month it increased slightly to 62.4%.
Figure: 14 Labor Market Distribution
Conclusion
After the confusing January report, the data has returned to “normal” where the Headline Report dramatically overstates the Household Survey and QCEW. In short, the job market may be much weaker than it appears.
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