September jobs report - 248,000 jobs added, 5.9% unemployment rate

If one doesn’t dig too deep, the September jobs report looks healthy, and exceeded expectations of 215,000 jobs added and an unchanged 6.1% unemployment rate:

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Total nonfarm payroll employment increased by 248,000 in September, and the unemployment rate declined to 5.9 percent, the U.S. Bureau of Labor Statistics reported today. Employment increased in professional and business services, retail trade, and health care.

Household Survey Data

In September, the unemployment rate declined by 0.2 percentage point to 5.9 percent. The number of unemployed persons decreased by 329,000 to 9.3 million. Over the year, the unemployment rate and the number of unemployed persons were down by 1.3 percentage points and 1.9 million, respectively….

The civilian labor force participation rate, at 62.7 percent, changed little in September. The employment-population ratio was 59.0 percent for the fourth consecutive month….

Establishment Survey Data

Total nonfarm payroll employment rose by 248,000 in September, compared with an average monthly gain of 213,000 over the prior 12 months. In September, job growth occurred in professional and business services, retail trade, and health care….

The change in total nonfarm payroll employment for July was revised from +212,000 to +243,000, and the change for August was revised from +142,000 to +180,000. With these revisions, employment gains in July and August combined were 69,000 more than previously reported.

Left unmentioned in the BLS press release was that, on a seasonally-adjusted basis, there were 236,000 more private-sector jobs in September than in August. Also unmentioned – the U-5 rate, which includes those who want to work and last looked for work between mid-September 2013 and mid-August 2014, went down from 7.4% to 7.3%, while the U-6 rate, which includes those working part-time due to economic conditions in addition to those included in the U-5 rate, went down from 12.0% to 11.8%.

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The “little” change in the seasonally-adjusted labor force particpation, a rounded 0.1 percentage point drop, means that the seasonally-adjusted participation rate for September is now lower than it was every month since February 1978, when it was also 62.7%. While there were 232,000 more people working in September than in August, more than the 217,000 increase in the civilian non-instutional population, there were 97,000 fewer people in the labor force.

Nearly half of those workforce dropouts, 45,000, became the increase in the number of those who want a job but are not part of the labor force. That number is now 6,349,000, with nearly 2/3rds of the uncounted unemployed last looking for work over a year ago.

Over the past year, 2,683,000 jobs were added on a not-seasonally-adjusted basis, 393,000 more than the growth in the civilian non-institutional population. However, over the same past year, only 12,000 more people gained employment, also on a not-seasonally-adjusted basis, than were added to the civilian non-institutional population.

On the part-time front, the seasonally-adjusted full-time/part-time monthly changes were a direct opposite of what they were in August, as 671,000 more people were working at least 35 hours per week and 384,000 fewer people were working less than 35 hours per week. That wildly-divergent series of seasonal adjustments makes that monthly comparison essentially worthless.

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Other measures are a bit more encouraging on that front. First, on a not-seasonally-adjusted basis, 2,483,000 more people were working full time last month than in September 2012, with 193,000 fewer people working part-time (for a net increase in 2,290,000 employed). Second, the average number of hours worked per week per job increased for the first time since March, from 34.5 hours per week to 34.6 hours per week on a seasonally-adjusted basis. Similarly, the number of overtime hours worked on manufacturing jobs also increased by 0.1 hours per week.

That is not to say that all the news is good. Among all production and non-supervisory workers, the number of hours per week per job fell by 0.1 hours to 33.7 hours, where it had been between March and July.

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John Stossel 12:00 AM | April 24, 2024
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