Friday, January 4, 2019

December Jobs Data: Another Strange but Good Month – Per AJSN, We’re Now 15.8 Million Jobs Short

The headline number in this morning’s Bureau of Labor Statistics Employment Situation Summary was indeed an eye-grabber.  With economic and governmental turmoil and a sharply dropping stock market, I thought the projection of 177,000 net new nonfarm positions was high.  Not only was it not, it was more than 100,000 short, as that came in at a huge 312,000. 

Did the other numbers follow?  Not like that, and in many cases not at all.  Both seasonally adjusted and unadjusted unemployment were up 0.2%, at 3.9% and 3.7% respectively, with the adjusted number of jobless up almost 300,000 to 6.3 million.  While the labor force participation rate gained 0.2% to 63.1%, the employment-population ratio sat at 60.6%, meaning the outcomes were split for the two statistics showing how common it is for Americans to be on labor’s front lines.  The count of people officially jobless for 27 weeks or longer held at 1.3 million, but those working part-time for economic reasons, or holding on to part-time opportunities while looking unsuccessfully so far for full-time ones, fluctuated to 4.7 million, down 100,000 after going up twice that last month.  The second most striking change, though, was also positive, as private nonfarm payroll wages were up 11 cents per hour, or about double the inflation rate, to reach $27.48.

The American Job Shortage Number, the measure showing latent demand for work, was hurt by rises in both the numbers of unemployed and those wanting opportunities but not looking for them for a year or more, and increased 328,000, as follows:

Smaller but substantial offsets to the AJSN’s upsurge were changes in the count of those discouraged, off 78,000, and a crash in the number of those in the armed forces, in institutions, or off the grid, over 1 million lower.  Compared with a year before, the AJSN is down 446,000, helped most by about 250,000 fewer unemployed, 100,000 fewer discouraged, and 2.6 million out of the miscellaneous category above. 

Was December a good month?  With that stunning gain in jobs, certainly.  Was it a great month?  No, not really.  The rises in the unemployment rates, which seem caused by the common good-times effect of more people joining the labor force than can get work, do not bother me.  My cause for concern is, despite clear-cut overall prosperity, visible in several of the fringe numbers, specifically long-term unemployed, working part-time for economic reasons, not wanting a job, and, more than anything else, the over 3 million claiming interest in working but not seeing fit to look for it for a year or more.  The lack of progress in these areas say that our continued employment growth is leaving too many people behind.  It does no good for those past the half-year mark of collecting unemployment benefits (or seeing them end), proving themselves at short-hours positions while getting nowhere at working as much as they want, or keeping themselves on the shelf despite harboring hopes of finding something suitable which never seems to materialize, to read about opportunities elsewhere, in other industries, or at other levels.  What is happening with these people needs more attention.  In the meantime, though, the turtle, once again, took a step forward.

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