Another good (?) Jobs Report - Sept adds 336K jobs

Whoah betsy, several issues with your analysis.

First, you gotta pull that lens back a bit.

LFPR was declining for two decades, leveled off for 5 years, then covid hit and when people came back to work in the years since, it shot up.

Looking at very short time frames is misleading since LFPR won't vary much, if at all, in any month-to-month comparison under normal conditions.

As for the labor market supposedly losing 692k jobs, I am not sure where you got that number from? Can you be more specific? TY

Anyway, if you based it off of the Household Survey, this is mistaken since the Household Survey is not a measure of jobs from the biz side of things, but people's employment status (e.g. LFPR, UE, full vs part time work).

You can't deduce the composition of that 336k arrived at in the Establishment Survey by using Household Survey numbers.

Govt (public sector) jobs comprise about 15% of all jobs. Those numbers will vary monthly as overall jobs numbers vary. Sometimes they comprise a higher percentage, sometimes lower. But even w/o the 73k govt jobs, Sept numbers would have beaten expectations by 93k (a 54% increase above expectations).

It might be a sign. It might not be. Short term trends aren't going to make for very strong conclusions about specifics without at least knowing more about what the reasons are for working multiple jobs.

This is a misleading graph as you interpret it. Notice the Y-axis on both sides of the graph and the very different numbers. There are nearly 5x more full time than part time workers. However, that graph was created by the FRED to show the trends.

Pull back the lens, and also look at full vs part time on the same axis and on their own axis in the same graph.

The Establishment Survey is the only BLS tool for calculating jobs. To make an apples to apples comparison to ADP, you need to use the 336k for Sept.

Also, each month, hundreds of thousands of jobs are lost or gained. The monthly job numbers are the net result. However, the Establishment Survey doesn't show jobs lost other than when the net is a negative number.

We need to be very careful when comparing numbers from different data sets that are based on different underlying sample data. Can lead to bad conclusions.

 

That is simply your opinion. LFPR experienced a dramatic shift after 2007. Baby boomers started to dramatically account for the drop in LFPR even as we started to dig out of the great recession.
https://crr.bc.edu/the-impact-of-aging-baby-boomers-on-labor-force-participation/

Ignoring LFPR data in the short term is just ridiculous especially since it's been an upward trend since Jan 2021. A shift in that trend is something to look for.

Even BLS in their notes shows government addition this past month was just above 30k than normal additions. On top of that, the seasonally adjusted part-time additions to the headline number were 151k.

The chart merely shows two different data points. How is it misleading in any way? Are the data points wrong? It's merely a way to show you both sets of data on a timeline to show trends of both individually. It's not meant to say that part-time jobs are the same amount as full-time. In fact, the Y-axis numbers even correctly show you that.

Yes, it definitely makes more sense to compare the establishment survey to ADP. It was just interesting to me that the household survey more closely resembles ADP this prior month.

Look all I am saying the last few months is there are warning signs. We will need to continue to monitor the full-time position numbers. Oh also, the feds almost never get it right... Still too many fed members talking about 1-2 more rate hikes.

 

Not ignoring LFPR in the short term, but saying it doesn't tell us much of anything. In any two-month period, the most frequent change is .1 up or down. The second most frequent is no change at all (and together they comprise two-thirds of month to month variation since 1948). Which is to say that change itself is small, ntm inconsistent up or down in the short term because such fluctuation is normal.

To use your example, boomer retirement affecting LFPR is only noticeable over a longer period of time, not several months because even as LFPR trended downward, many times there was no change or only a small change up or down.

My comment was about govt jobs comprising nearly 15% of the labor force, thus it's always going to be that they comprise a portion of monthly jobs just like any other sector. Yes, a higher percentage this month, but sometimes a lower percentage. And again, even without the 73k govt jobs, Sep job numbers exceeded the 170k expectation by 93k jobs.

Part time work is not a component of the Establishment Survey. It is a measure in the Household Survey, but those surveys are two completely different samples measuring different components of "employment" I think you might be conflating the two. Or maybe I'm wrong. Just not seeing where that 151k is coming from?

I mentioned the two Y-axis but what I meant by misleading is with regard to the short time period. I think we need to consider the longer trends, not very short periods (shown in the FRED graphs that I linked to in my previous comment).

It is interesting. I think it might be more @ coincidental (or not) since ADP like the BLS Establishment Survey measures employment via employers. Same time, I'd like to see how ADP might correspond to the household survey over time. Not sure if there is any correlation and haven't looked at it.

Not sure if what you see as warning signs are legit. Maybe, but it doesn't seem to be if based on monthly jobs, or on part time vs full time employment or LFPR, at least not if derived from the short term, which is much more prone to errors in interpretation, especially over-interpretation.