It Looked Like a Positive Jobs Report Month, Despite AJSN Showing Latent Demand Up Almost 400,000 – But Was It?

This morning’s Bureau of Labor Statistics Employment Situation Summary was supposed to be favorable, with published estimates I saw of the net new nonfarm payroll positions with increases of 165,000, 165,000 and 170,000.  Its 256,000 well exceeded those, and most of the other statistics followed.  Seasonally adjusted and unadjusted unemployment fell 0.1% and 0.2% to 4.1% and 3.8%.  The number of unemployed was off 200,000 to 6.9 million, with 100,000 fewer of those out for 27 weeks or longer, reaching 1.6 million.  The count of people working part-time for economic reasons, or thus far unsuccessfully seeking full-time work while holding on to lower-hours propositions, dropped another 100,000 to 4.4 million.  The two measures showing how common it is for Americans to be working or officially jobless, the employment-population ratio and the labor force participation rate, gained 0.2% and stayed the same, ending at 60.0% and 62.5%.  The unadjusted count of employed lost 162,000 to 161,294,000.  Average private nonfarm hourly payroll wages reached $35.69, 8 cents, or slightly less than inflation, more than the previous month. 

The American Job Shortage Number, the metric showing how many more positions could be quickly filled if all knew that getting one would be little more than an ordinary daily errand, worsened with a 359,000 increase, as follows:

Almost all of the AJSN’s increase is probably illusory, as the Census Bureau greatly increased their view of the American population from November 16^th to December 16^th, the dates of record for the AJSN, and so the non-civilian et al. category above, which takes the difference between those included in our population and in any employment category, rose almost 3.4 million.  Accordingly, the share in the AJSN flew up almost as much as the statistic increased.  Otherwise, the fall in those officially unemployed was essentially offset by a gain in those wanting work but not looking for it during the previous year, and there were no other large changes.

Compared with a year earlier, the AJSN grew just over 200,000, with the largest changes from a lower number of expatriates (subtracting 700,000 from the AJSN), more people officially jobless (adding 490,000), more in armed services or unaccounted for (adding 349,000), and more discouraged (adding 127,000). 

So what’s the real story here?  It was good, but tempered by 683,000 net drop in the labor force, which along with 432,000 more claiming no interest, means that too many, perhaps the same people previously stepping back into the job-search world without finding what they wanted, are departing.  Will that be a problem in 2025?  We will continue tracking it, which we need to know before being enthusiastic about improvements mostly attributable to a smaller labor force.  In the meantime, though, the turtle took a fair-sized step forward.