This Morning’s Employment Report Featured Another Fine Jobs Gain, But Latent Demand by AJSN Grew 300,000, With Overall Weakness Elsewhere

The new Bureau of Labor Statistics Employment Situation Summary started out, again, by exceeding expectations.  The number of net new nonfarm payroll positions, formally estimated at 160,000 and 170,000, handily beat both with 216,000.  Seasonally adjusted and unadjusted unemployment did not drop but held their November 0.2% and 0.1% improvements to stay at 3.7% and 3.5%.  The count of jobless remained at 6.3 million, and those out for 27 weeks or longer held at 1.2 million.  Given that inflation keeps dropping, we can cheer the average private nonfarm payroll earnings rising more than that, 17 cents per hour to $34.27. 

From there, the numbers disappointed.  Those employed fell about 1.4 million to 160,754,000.  Those not interested rose just over a million to 95,865,000.  The count of those working part-time for economic reasons, or staying in part-time positions while looking for full-time ones, gave up most of its November improvement to reach 4.2 million.  The two measures of how common it is for Americans to be working or close to that, the labor force participation rate and the employment-population ratio, did even worse, dropping 0.3% and 0.4% to get to 62.5% and 60.1%. 

The American Job Shortage Number or AJSN, the measure showing how many new positions could be quickly filled if all knew that getting one would be about as hard as running a household errand, increased 324,000 to this:

Most of the change from November was from almost 300,000 more people not looking for work for the previous year, offset partially by fewer claiming discouragement.  Compared with a year before, the AJSN is almost 400,000 higher, with the unemployed contributing almost half a million to the metric and the effect of more people wanting work but not looking for it for a year or more adding a surprising 184,000.  The share of the AJSN from official unemployment was 33.3%, meaning that two-thirds of people who would fill new jobs would not have that status.

So where are we now?  Some of the downturns look like possible mid-December biases, as it is then easy for people to hold off on job-seeking activities and positive attitudes about it until after the holidays.  When people are not working then, it’s easier than usual for them to accept that.  Yet the previous December was better.  The number of net new positions keeps marching on, but there’s little improvement elsewhere, and more unemployed Americans in conjunction suggests that those choosing to be overemployed or working more than one full-time position, or keeping more than one part-time job, are getting more common.  But it’s too early to claim any trends there.  Next month’s report, based on a historically strong back-to-work month in January, will tell us whether underlying factors in American unemployment and employment are changing.  In the meantime, the turtle took but a tiny step forward.