Friday, January 6, 2023

Yet Another Strong Jobs Report – AJSN Reports Latent Demand Down 200,000 to 15.6 Million

Once again, the Bureau of Labor Statistics Employment Situation Summary delivered.

We exceeded the matching 200,000 published predictions of net new nonfarm positions by 23,000.  Seasonally adjusted and unadjusted unemployment each fell 0.2%, to reach 3.5% and 3.3% – both are still range-bound, with the former marking its tenth straight month between 3.5% and 3.7%, but at the bottom.  There were 5.7 million unemployed workers, down 300,000.

Three other results were also favorable.  The count of those jobless for 27 weeks or more shed 100,000 to 1.1 million.  The two measures showing how common it was for Americans to be working or officially unemployed, the labor force participation rate and the employment-population ratio, each rose a substantial 0.2% and are now at 62.3% and 60.1%.  Among numbers tracked here, the only exceptions were the number of those working part-time for economic reasons, or keeping short-hours positions while so far unsuccessfully seeking full-time ones, which gained 200,000 to 3.9 million, and average private nonfarm payroll wages, which increased only the amount of a downward November adjustment and are again reported as $32.82.

The American Job Shortage Number or AJSN, the statistic showing how many openings in addition to those out there now could be quickly filled if all knew they would be trivially easy to get, lost 220,000 to reach the following:

This metric still improved, despite a Census Bureau national population adjustment which added about 700,000 people which, not coordinated with the BLS numbers above, served to increase the non-civilian et al. count, as those are Americans about whom we have no other employment-status information.  More than offsetting that were, especially, the number unemployed, removing 154,000 from the AJSN, and a smaller count of those wanting to work but not looking for it for a year or more, taking away 131,000.  The share of the AJSN from those officially jobless was 30.9%, down from November’s 31.5%. 

Compared with a year before, the AJSN dropped 759,000, with the numbers shrinking most the officially unemployed, taking 551,000 off the statistic, and those not looking for a year or more improving its contribution by 283,000.

On the Covid front, while the endemic worsened sharply, with, per the New York Times, the 7-day daily average of new cases up 64% to 64,450 from November 16th to December 15th-16th, the same for people hospitalized 45% more at 40,380, and deaths up 12% to 373, these figures are still too low to imply that workers should be avoiding their jobs. 

Overall, where are we now?  Still nowhere near a recession.  Charts published today show that we are adding fewer new positions than for most of the past two-plus years, but they do not include a horizontal line showing how many we needed to cover population increases, which would run through and near the bottom of the monthly histogram bars.  We’re pushing the bottom of the unemployment-share range, hardly a bad place to be camping out.  Wage increases have sputtered, but inflation is dropping.  And none of this has been reversed during the months of higher interest rates.  The good times are rolling, and the turtle once again took a solid step ahead.

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