The unemployment rate, up two months is back to 4.2 percent.
Initial Thoughts
Two years ago full-time employment was 134.4 million. It’s now 135.1 million, up by about 700,000. Nonfarm payrolls are reportedly up over 4.2 million in the same timeframe.
For the second month the unemployment rate rose. With more government layoffs coming expect to see more increases.
77,000 jobs were education and health care services.
Revisions too away 48,000 from January and February.
Job Report Details
- Nonfarm Payroll: +228,000 to 159,398,000 – Establishment Survey
- Civilian Non-institutional Population: +176,000 to 273,023,000
- Civilian Labor Force: +232,000 to 170,591,000 – Household Survey
- Participation Rate: +0.1 to 62.5% – Household Survey
- Employment: +200,000 to 163,508,000 – Household Survey
- Unemployment: +31,000 to 7,083,000 – Household Survey
- Baseline Unemployment Rate: +0.1 to 4.2% – Household Survey
- Not in Labor Force: -56,000 to 102,431,000 – Household Survey
- U-6 unemployment: -0.1 to 7.9% – Household Survey
Nonfarm Payrolls Change by Sector
Monthly Change in Nonfarm Payrolls
Monthly Revisions
- The change in total nonfarm payroll employment for January was revised down by 14,000, from +125,000 to +111,000.
- The change for February was revised down by 34,000, from +151,000 to +117,000.
- With these revisions, employment in January and February combined is 48,000 lower than previously reported.
Part-Time Jobs
- Involuntary Part-Time Work: -157,000 to 4,780,000
- Voluntary Part-Time Work: +190,000 to 22,625,000
- Total Full-Time Work: +459,000 to 133,135,000
- Total Part-Time Work: -44,000 to 28,467,000
- Multiple Job Holders: +76,000 to 8,936,000
After subtracting 1.22 million full time jobs last month this month we see a partial reversal of 459,000.
The above numbers never total correctly due to the way the BLS makes seasonal adjustments. I list them as reported.
Note that multiple job holders add to nonfarm payrolls but not the number of employed.
Hours and Wages
This data is frequently revised.
- Average weekly hours of all private employees was flat at 34.2 hours.
- Average weekly hours of all private service-providing employees was flat at 33.1 hours.
- Average weekly hours of manufacturers rose 0.1 hour to 40.2 hours.
An overall decline or rise of a tenth of an hour does not sound line much, but with employment over 160 million, it’s more significant than it appears at first glance.
Hourly Earnings
This data is also frequently revised. Here are the numbers as reported this month.
Average Hourly Earnings of All Nonfarm Workers rose $0.09 to $36.00. A year ago the average wage was $34.67. That’s a gain of 3.8%.
Average hourly earnings of Production and Nonsupervisory Workers rose $0.05 to $30.96. A year ago the average wage was $29.80. That’s a gain of 3.9%.
Unemployment Rate
The Trump optimism improvement is over.
Reasons Why the Unemployment Rate Will Rise
- DOGE Government Firings
- Massive tariff and trade distortions
- General business slowing even before the above distortions
Alternative Measures of Unemployment
Table A-15 is where one can find a better approximation of what the unemployment rate really is.
- The official unemployment rate is 4.2 percent.
- U-6 is much higher at 7.9 percent.
Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.
Some of those dropping out of the labor force retired because they wanted to retire. Some dropped out over Covid fears and never returned. Still others took advantage of a strong stock market and retired early.
The rest is disability fraud, forced retirement (need for Social Security income), and discouraged workers.
Birth Death Model
Starting January 2014, I dropped the Birth/Death Model charts from this report.
The birth-death model pertains to the birth and death of corporations not individuals except by implication.
For those who follow the numbers, I retain this caution: Do not subtract the reported Birth-Death number from the reported headline number. That approach is statistically invalid.
Birth-Death Methodology Explained
I gave a detailed explanation of the model and why the hype is wrong in my June 8, 2024 post How Much Did the BLS Birth-Death Adjustment Pad the May Jobs Report?
I repeat, do not subtract the birth-death number from the headline number. That’s flawed.
However, it is now clear that the BLS is too optimistic about the number of jobs they believe are being created by the net creation of new businesses.
Household Survey vs. Payroll Survey
- The payroll survey (sometimes called the establishment survey) is the headline jobs number. It is based on employer reporting.
- The household survey is a phone survey conducted by the BLS. It measures employment, unemployment and other factors.
If you work one hour, you are 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.
Looking for job openings on Jooble or Monster or in the want ads does not count as “looking for a job”. You need an actual interview or send out a resume.
These distortions artificially lower the unemployment rate, artificially boost full-time employment, and artificially increase the payroll jobs report every month.
The BLS payroll reports smack of oversampling large employers and undersampling small employers where jobs have been trending lower.
Final Thoughts
Despite all the work I put into these reports, all of the BLS monthly data is total garbage.
I do the best with BLS data that I can, or anyone can.
The quarterly QCEW and Business Employment (BED)reports represent a 96 percent sample. But those reports lag by about 5 months.
The QCEW reports have been hugely negative and there is every reason to believe QCEW trends will continue.
Related Posts
January 31, 2025: The BLS Confirms US is Now Losing Jobs in Net Business Creation
The BLS BED report provides further confirmation the BLS Birth/Death jobs model is seriously screwed up.
The Birth-Death model that feeds the monthly jobs report is bogus. It has been screwed up since Covid, first underreporting jobs then overreporting them.
April 3, 2025: What’s the White House Formula for Calculating the Huge Tariffs?
The lead image explains the methodology.
April 3, 2025, Five Republican Senators Break Ranks With Trump Over His Tariff Madness
Five Republican Senators unite with Democrats against Trump’s tariffs.
Tariff madness is bound to impact hiring and spending. The stock market decline will impact consumer optimism and high end spending due to wealth impact.
This can easily feed on itself.
This will all be reversed next month.
SPY breached Aug 5 low, but SPX didn’t.
Hey Mish, are you still thinking about moderating comments?
25 comments so far, and less than a third are about the employment report and situation you blogged about.
Half of the rest sound like the chittering of my pre-teen daughter and her friends
You might have let your password to Mish’s blog on a post-it stuck on your computer. That could explain it.
I remember when the Chinese loved Buicks
ahh c’ estlavie !
In CA U-6 is over 10%.
China ban: Ford, Tesla and GM. The reps and the dems are united together against this theft. That’s the final blow to globalization. JP what are u going to do ?
Tariff policy is one tool designed to rebalance economy from dependence upon Fed Largess and recycling trade deficits into funding US Fiscal spending, back to market based growth.
Rebuilding middle class was primary economic objective of one of the candidates. The one that got elected.
He is not concerned with overseas Oligarchs or Domestic ones either.
Trump’s tariff policy just exported our recessiion to countries we run large trade deficits with. The US will see stagflation while everyone else gets recession.
This is just a garden variety correction in the equity market. Hard assets will do well. The middle class will be getting their jobs back from China. Strong jobs report today. USA!
markets in free fall again today. Something in the financial system is going to crack. Thats how the stupidity of one man can bring misery to the whole world.
More likely the stupidity of investors chasing a wildly overpriced market bought the correction on.
Only 100 points to an official bear market.
That was an hour ago, it might be there now, or it could be in an enormous rip up. Volatility is high.
Obozo dictated a 30 hour week was full time for Obamacare. The rest of the government data are equally distorted. When a government statistician chooses between a sweet do nothing high paid job and the truth he always chooses the job.
A better measure of employment is to count homeless under the highway underpass or count sidewalk tents in San Francisco, Seattle, Portland. Measure industrial production by railroad freight car loadings, and electricity consumption. Credit card activity is an index of retail demand. Auto loan defaults and fentanyl deaths tell you how it’s going for the men in the trenches. What this country needs is high tariffs and low interest factory construction loans.
I think many would agree the way the government collects data and how they analyze it needs a deep overhaul. Much of it has become meaningless at best and misleading at worst.
Illegals did the jobs that American workers refused to be exploited by. Perhaps displaced government workers can do the jobs illegals refuse to do. Time will tell.
Government worker is an oxymoron.
Gas at the pump should be down 35 cents at least based on the last few days. Will show up in the next week or so.
This is no time for comedy.
Umm, no. It’s a commodity. It’s down a lot. Thankfully. A tax cut for the American public.
You’re a funny guy, you should take that show on the road.
I’m sorry your inflated asset prices are going down. Our own Mish pegs housing at over 40% overvalued. Perhaps ripping the band-aid off and man up a better method.
I’m sorry you’re an adult with children and no assets. Perhaps showing a little personal responsibility before having kids would have been the manly thing to do.
Your fact less ad-hominem comments add no value. I’m putting you on ignore and suggest the same to others.
I give what I get. Obviously you can’t take it when people stand up for themselves.
I would rather have lots of children and no assets. The worst is having lots of assets and no children.
Here here. But I have assets and kids. I just don’t allow assets to dictate policy. Thinking beyond yourself is how grown ups are supposed to act.
You don’t allow or not allow anything to do with policy. To think otherwise is psychotic.
That hasn’t worked so well in many parts of the world, such as for the Palestinians, Sudanese, most of SE Asia, etc. etc. all of which have too many mouths to feed (kids) and no assets to purchase food or land.
Can’t take a good pun?
The cost of a house is quite fixed. Labor, materials, permits, infrastructure ( water, gas,cabeling etc.), layers of insurance ad nauseum. Also, the revenue for your County is based on the price of your house. Nothing is coming down short of economic collapse.
Yes I remember people saying the same in 2005-2007, how did that turn out. Affordability the worst in 50 years and you are claiming it can’t happen?
Without jobs think of all the money workers will save by not driving to work everyday!
I guess you missed the jobs report.
Nice!
Don’t worry, Washington state is about to hike the gas taxes again.
Maybe .Gov workers are learning to code. Its been tough to stick a fork in this economy.
Coding is dead. More likely they’re training AI.
The Commerce Secretary says he thinks that blue collar workers can be taught “how to be robotics, mechanics, engineers and electricians for high tech factories”.
Where have I heard this before? Oh yeah, the idea of training out-of-work truck drivers and other blue collar workers to be web developers, programers, etc. [rotflol]
Far better than expected. Good stuff