Friday, February 3, 2023

Big Jobs Gain in January Offsets Part of Seasonal Unemployment – AJSN Shows Latent Demand at 16.7 Million, Up 1.1 Million


January usually has the steepest drop in American employment.  Millions of people end their holiday-related jobs, and not all find new ones.  The gap between adjusted and unadjusted employment is the year’s largest, as it is for most other work-related labor numbers.

That was at the center of this morning’s Bureau of Labor Statistics Employment Situation Summary.  Dominating the headlines should be the count of net new nonfarm positions, which blew away the also-seasonally-adjusted published 185,000 estimate and turned in 517,000.  Other figures looked good as well – adjusted joblessness trimmed 0.1% to reach 3.4%, average private payroll nonfarm wages beat inflation by jumping 21 cents to $33.03, and the two measures of how common it is for Americans to be working or officially unemployed, the employment-population ratio and the labor force participation rate, each grew a significant 0.1% to 60.2% and 62.4%.  Not improving were the count of those unemployed for 27 weeks or longer, still 1.1 million, and the number of officially jobless, still 5.7 million.  On the down side were unadjusted unemployment, now 3.9% instead of 3.3%, the total working, off 180,000 to 158.692 million, and the number of people working part-time for economic reasons, or holding on to such opportunities while searching for full-time ones, which gained a second-straight 200,000 and is now at 4.1 million. 

The American Job Shortage Number or AJSN, the metric showing how many additional new positions could be quickly filled if all knew they would be easy to get, gained over 1.1 million to reach the following:

More than the total increase was from the officially unemployed and those reporting they wanted work but had not sought it for at least 12 months.  Best showing the overall progress we made was a year-over-year comparison, which revealed that since January 2022 the measure has lost 1.1 million, mostly accounted for by these same two components.  The share of the AJSN from official joblessness rose 3.4% and is now 34.3%. 

On Covid-19, per the New York Times the seven-day daily averages of new cases measured December 16th and January 16th dropped 8% to 59,260, that for deaths measured on the 15ths rose 51% to 564, and that for hospitalizations, on the same dates, grew 7% to 43,137.  Despite the last two worsening, these numbers are well below the virus’s pandemic-era performance and do not indicate particular concern about dangerous jobs.

What do we make of all this?  The AJSN is not seasonally adjusted, so can look worse than it is in down-employment times of the year.  Although we didn’t really add 517,000 jobs, we didn’t lose anywhere near the typical actual December-to-January 700,000, only about one quarter of that.  As any serious poker player can tell you, avoiding losses can be as valuable as winning.  Our population, including children and those well past 65, gained only 113,000 last month, and we are, month after month, adding more jobs than that.  This was another excellent report, and the turtle took another healthy step in the right direction.

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