A Strange but Telling Jobs Report: 339,000 Net New, Latent Demand Up Over a Million

The headline piece of this morning's Bureau of Labor Statistics Employment Situation Summary was how the number of nonfarm payroll jobs destroyed the estimates.  I saw three of those, ranging from 180,000 to 193,000, and it came in at 339,000.  Right behind that, though, was a 0.3% jump in seasonally adjusted unemployment, from 3.4% to 3.7%, matched by the same change to the unadjusted variety, which went from 3.1% to 3.4%.

How could unemployment and jobs both go up so much?  Another figure held the answer.  The count of people reporting they did not want to work fell from 95,077,000 to 93,912,000 – over a million in one month. 

Otherwise, the number employed dropped 73,000 to 161,002,000, not much but not a gain, and the two measures of the likelihood of people working or being one step away, the employment-population ratio and the labor force participation rate, lost 0.1% and broke even respectively to reach 60.3% and 62.6%.  The count of those officially jobless for 27 weeks or longer stayed at 1.2 million, but the number of those working part-time for economic reasons, or keeping such limited work while looking thus far unsuccessfully for the full-time variety, matched May’s 200,000 loss and is now at 3.7 million.

The American Job Shortage Number or AJSN, the statistic showing how many additional positions could be quickly filled if all knew they would be easy to get, gained over a million, as follows:

 

 Along with the half-million gain in the AJSN’s share of those unemployed was almost as much from those wanting work but not looking for it in the previous year.  Otherwise, the largest contributions were from people temporarily unavailable and in school or training.  The share of the AJSN from unemployment gained 1.3% to 31.3%. 

The most informative comparison was with the year before.  Although there were 2.4 million more Americans working in May 2023 than in May 2022, latent demand was almost identical.  The AJSN for both rounded to 16.4 million, and the largest difference in any of the categories above was less than 180,000.  The count of those in the armed services, institutionalized, and off the grid fell 970,000, meaning real gains for other statuses.  All of that means we have completely absorbed the 2.4 million jobs, without any decrease in how many people want to work.  And our population, even including children, retirees, and 570,000 more claiming no interest in employment, increased less than that.

Overall, what’s happening?  We are adding many jobs and they are being filled.  While masses of baby boomers are turning 65, they are hardly moving uniformly from employment to not wanting that.  There were plenty of Americans who, in the past month, joined more ambitious categories but did not find work.  Wait until next month for them – for most, it won’t take much longer.  The United States job market is getting more and more robust, and this edition underscored how deep our pool of potential employees actually is.  Accordingly, the turtle took another solid step forward.