The discrepancy between the increase in jobs and the increase in employment is 1,191,000. On average, over the past year, that’s a discrepancy of 99,250 every month, in favor of jobs.
Household Survey vs. Payroll Survey
The payroll survey (sometimes called the establishment survey) is the headline jobs number, generally released the first Friday of every month. It is based on employer reporting.
The household survey is a phone survey conducted by the BLS. It measures unemployment and many other factors.
Numbers in Perspective
- In the household survey, if you work as little as 1 hour a week, even selling trinkets on eBay, you are considered employed.
- If you don’t have a job and fail to look for one, you are not considered unemployed, rather, you drop out of the labor force. Searching want-ads or looking online for jobs does not count. You need to submit a resume or talk to a prospective employer or agency.
- In the household survey, if you work three part-time jobs, 12 hours each, the BLS considers you a full-time employee.
- In the payroll survey, three part-time jobs count as three jobs. The BLS attempts to factor this in, but they do not weed out duplicate Social Security numbers. The potential for double-counting jobs in the payroll survey is large.
These distortions and discrepancies artificially lower the unemployment rate, artificially boost full-time employment, and artificially increase the payroll jobs report every month.
Nonfarm Payrolls vs Employment
Over time, the numbers move in sync. There is no clear pattern around recessions. In many years the levels converge before a recession, but ahead of the great recession the numbers diverged.
Nonfarm Payrolls vs Employment Detail
In December of 2009 the difference between payrolls and employment was 8.21 million. This month, the difference is 5.56 million.
Since the lows in December of 2009, the BLS tells us employment rose by 18,632,000. The number of jobs rose by 21,291,000. That’s a difference of 2,659,000.
In the past year alone, the difference between jobs and employment is a whopping 1,191,000. That’s a discrepancy of 99,250 every month, in favor of jobs.
I strongly suggest double-counting of jobs by the BLS when people take extra part-time jobs or shift jobs.
For a closer look at today’s jobs report please see Jobs +263,000 vs. Employment -103,000: Unemployment Rate 3.6% Lowest Since 1969.
Mike “Mish” Shedlock
I don’t trust any data coming from the government. With unemployment this low, we should be seeing large wage growth. Which we aren’t.
Is a telephone survey still useful when so many people are ignoring phone calls from numbers they don’t recognize?
Why Fed Chair Powell is a Laughingstock
Just this week, for example, Powell zoomed in on the dots and concluded that the federal funds rate should remain within a range or 2.25 to 2.5 percent. At the same time, via an implementation note, Powell lowered the interest on excess reserves (IOER) rate 5 basis points to 2.35 percent.
How’s that recession call coming along Mish?
The fact that MISH has pointed out how easy it would be to eliminate double (triple) counting jobs means the government wants this distortion.
Has anyone looked at the labor participation rate ? They are just bouncing off lows since the great recession. They were in.the high 60s during the.80s and 90s. Now it’s in the low 60s. I suspect over time this number goes lower yet as the.demographics change. At some point there will be no getting away from many truths about the labor markets.
There should be an LPR for robots and automation. Then we could overlay the graph lines and compare!
Entire decade of (simulated) job growth,could we possibly see wait for it……….one trillion (with a T)straight months of (simulated)job growth,a negative print unemployment “rate”,one million straight quarters of a positive GDP “rate”and it only costs a few tril a year in red ink.
You ought to go on TV because all I keep hearing from the talking heads is “LOWEST UNEMPLOYMENT NUMBER IN A GENERATION!”.
So why are housing sales cratering? Why are people living in RV’s and tents everywhere you look? Why are so many people with new cars aspiring to be glorified tax drivers, sporting Uber/Lyft signs in their car windows? I must see hundreds of these drivers in a typical week!
Because the BLS numbers are based mostly on guessing.
“Why are so many people with new cars aspiring to be glorified taxi drivers” Ha, true talk! Yes all those Uber/Lyft cars I see every day are newer vehicles, not cheap … but they will be cheap after a few years of have 30K miles/yr piled on them.
I’ve had the opportunity to help a beautiful, smart, engaged young woman (24 years young) with multimillionaire parents(divorced) here in LA look for a van to live in. Was shocked at the prices and demand for basically worn out vans for people to live in. Financialization of our economy by Wall Street and the Central Bankers is destroying us. FDR had it right breaking up the big banks.