Friday, October 6, 2023

Jobs Report: Another Banner and Expectation-Exceeding Month, with AJSN Showing Latent Demand for Positions Down Over 600,000 to 16.2 Million

Another month, another jobs report, another big winner.  Why do I say that?

First, we blew away the published forecast of 170,000 net new nonfarm payroll positions with 336,000 – almost double.  Second, we added 242,000 employed people to reach 161,669,000.  Third, those were accomplished with private nonfarm payroll wages going up only 6 cents per hour, to $33.88 – less than inflation.

Much of the rest broke even, including the seasonally adjusted unemployment rate at 3.8%, the adjusted number of officially jobless at 6.4 million, the labor force participation rate at 62.8%, and the employment-population ratio at 60.4%,  Others which did change included the unadjusted unemployment rate, down a seasonal 0.3% to 3.6%, the number of those jobless for 27 weeks or longer improving 100,000 to 1.2 million, and the count of those working part-time for economic reasons, or keeping such positions while looking thus far unsuccessfully for full-time ones 100,0000 better at 4.1 million.  The only discouraging number of the ones I consider front-line is the number of people not wanting a job, up 729,000 to 94,411,000.

The American Job Shortage Number or AJSN, the metric showing how many additional positions could be quickly filled if all knew they would be easy to get, fell a remarkable 621,000 to reach the following:


Five-sixths of the drop was from official unemployment, with another 138,000 from a lower count of those wanting work but not looking for it during the previous year.  None of the other factors added or subtracted more than 37,000.  With lower unemployment, the share of the AJSN from official joblessness came in at 33.6%, or 1.9% less than in August. 

Compared with a year before, the AJSN gained 223,000, with the 530,000 more contributed from higher unemployment mostly offset by improvements in the counts of those discouraged, those wanting work but not looking for a year or more, and non-civilian, institutionalized, and off-the-grid people comprising about one-eighth less than in September 2022.

Perhaps, with unemployment and workforce participation the same and more people getting on the shelf, September was not as good as I thought.  But, with so many new jobs added and once more no reasonably clear movement toward recession – not to mention noninflationary wage increases – we should take this data as a solid indication of continued prosperity.  As before, even if it means we are treading water, it’s plenty warm.  The turtle, once again, took a good step forward.

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