The economy continues to add a high percentage of government and social assistance jobs. Part time employment rose by 691,000 as full time employment fell by 6,000.
From September 2020 through early 2022, nonfarm payroll job gains and full time employment changes tracked together.
Starting around March of 2022, a divergence between employment and jobs became very noticeable, and I have been discussing the divergence since then.
Payrolls vs Employment Gains Since March 2023
- Nonfarm Payrolls: 2,927,000
- Employment Level: +642,000
- Full Time Employment: -1,347,000
Payrolls vs Employment Gains Since May 2022
- Nonfarm Payrolls: 6,205,000
- Employment Level: +3,152,000
- Full Time Employment:+264,000
Payrolls are up by 6.2 million since May of 2022, but full time employment up only 264 thousand.
No amount of BLS smoothing can hide this, but hardly anyone discusses it.
Q: What’s going on?
A: People are working multiple part time jobs and or semi-retired boomers are working part time.
Job Report Details
- Nonfarm Payroll: +303,000 to 158,133,000 – Establishment Survey
- Civilian Non-institutional Population: +173,000 to 267,844,000
- Civilian Labor Force: +469,000 to 167,895,000 – Household Survey
- Participation Rate: +0.2 to 62.7% – Household Survey
- Employment: 498,000 to 161,466,000 – Household Survey
- Unemployment: -29,000 to 6,429,000- Household Survey
- Baseline Unemployment Rate: -0.1 to 3.8% – Household Survey
- Not in Labor Force: -296,000 to 99,898 – Household Survey
- U-6 unemployment: +0.0 to 7.3% – Household Survey
Nonfarm Payroll Change by Sector
Government and Health Services are related to the surge of illegal immigrants and the need to address them. Social assistance jobs rose by 12,000 in January, 21,000 in February, and 9,000 in March.
Government jobs rose by 60,000 in January, 63,000 in February, and 71,000 in March
Change in Nonfarm Payrolls January 2022 to February 2024
Monthly Revisions
- The change in total nonfarm payroll employment for January was revised up by 27,000, from +229,000 to +256,000.
- The change for February was revised down by 5,000, from +275,000 to +270,000.
- With these revisions, employment in January and February combined is 22,000 higher than previously reported.
Part-Time Jobs
- Involuntary Part-Time Work: -68,000 to 4,308,000
- Voluntary Part-Time Work: +593,000 to 22,902,000
- Total Full-Time Work: -6,000 to 132,940,000
- Total Part-Time Work: +691,000 to 28,632,000
The above numbers never total correctly due to the way the BLS makes seasonal adjustments. I list them as reported.
Hours and Wages
This data is frequently revised.
- Average weekly hours of all private employees rose 0.1 hours to 34.4 hours.
- Average weekly hours of all private service-providing employees was flat at 33.3 hours.
- Average weekly hours of manufacturers was flat at 40.0 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 $0.12 to $34.69. A year ago the average wage was $33.31. That’s a gain of 4.14%.
Average hourly earnings of Production and Nonsupervisory Workers rose $0.07 to $29.79. A year ago the average wage was $28.58. That’s a gain of 4.23%.
Year-over-year wages are keeping up with inflation after underperforming for many months.
Unemployment Rate
The unemployment rate hit a 50-year low in January and April of 3.4 percent. It’s now 3.8 percent.
The unemployment rate has bottomed this cycle and will generally head higher.
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 3.8%.
U-6 is much higher at 7.3%. 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.
The model is wrong at economic turning points and is also heavily revised and thus essentially useless.
Birth-Death Methodology Explained
Every month this subject comes up. I gave a detailed explanation of the model and why the hype is wrong in my December 8, 2023 post How Much Did the Huge 412,000 Birth-Death Adjustment Impact October’s Job Report?
The month does not matter. If you think the model has a big impact, please click on the above link for why it doesn’t.
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.
Can the Jobs and Employment Numbers Both Be Reasonably Correct?
The answer is yes (discounting measurement error) because they measure different things. A person working three part time jobs counts for three jobs but only a single person employed.
I have repeatedly asked ADP to account for duplicate social security numbers but they won’t. Amusingly, the BLS wants to, but the employees tell me they can’t because “they don’t have access to the data for security reasons.”
This is a simple sort-merge program but alas, we depend on a phone survey for employment numbers.
Notably, discrepancies like these don’t last for years unless there is some truth to the employment numbers because measurement errors are random.
BLS Stats of the Month
- Employment +498,000
- Part time employment +691,000
- Full time employment -6,000.
Every month I caution the numbers do not add up but the discrepancy this month is huge.
Final Thoughts
This report is worse than headline numbers indicates. I said the same thing for the last four months, and it’s generally been that way for over a year.
There was one big positive this month: Employment jumped even though it was all part time.
Negatives include falling full time employment and another big surge in government jobs.
Government plus private education and health added 159,000 of the 303,000 jobs in the establishment survey. Most of that is related to the surge in illegal immigration.
It’s easy to make whatever claims you want this month. I point out the positive and negatives to allow that.
Why has no other source referenced the breakdown between part time job creation and the slight loss in full-time jobs? Appears to me to be significant.
GDI is better way to see if there is job growth
also need to eliminate govt spending – either debt or stealing from workers/companies revenue
Dramatic rise in cancer in people under 50
https://news.harvard.edu/gazette/story/2022/09/researchers-report-dramatic-rise-in-early-onset-cancers/
That is definitely affecting the jobs numbers.
This is what happens when billions inject a substance that was not tested for long term side effects.
Go figure
Odd that no analysts are factoring this into the equation. Oh right, that would alert the Vaxxers to the fact that they have poisoned themselves.
And nobody needs to know that
The fake mandate requirement, in effect, vaccinated the majority of the labor force. The deaths & disabilities that have followed support your analysis of the “official” released numbers.
Anyone who is eyeing the job of their manager…. should encourage said manager to get more booster shots… offer to drive him/her to the clinic … warn them not to put off that shot cuz Covid is still in play…
Rather than counting jobs, or unemployment rate, the metric that matters is number of employed people vs. total population.
The non-employed are, in terms of goods and services consumed, dependent on the employed, regardless of their legal wealth – unless their wealth is in non-perishable food. The ratio of total population to those employed is a dependency ratio.
The dependency ratio and its forward outlook matters a lot in nations with declining birthrates and/or aging-out of large birth cohorts.
Put another way, if the dependent population is increasing faster than the employed population, people overall will feel worse off even if the economy is technically “growing”.
It would only be true if the people who didn’t work weren’t in the following categories:
– had retirement savings or pensions
– hadn’t contributed to any retirement plan or social security (the latter is almost impossible)
– don’t have any form of passive income ( real estate or other investments)
I know many retired people who are not dependent on anything or anyone and doing just fine. Some I know are choosing to do work part time to use their brains and don’t even need the money or benefits.
Unfortunately you err. The employment metric is irrelevant – it’s the tax take of the government which counts. We can have everyone performing productive work but if their pay is below the tax rate, the government has very little to spend.
Much labor expansion presently is in government employees, paid with tax dollars, giving out more tax dollars – in one form or another – to people who do little taxable work. This is not sustainable.
GREAT ARTILCE AND WELL WRITTEN SO THE AVERAGE BRAIN LIKE MINE CAN UNDERSTAND IT COMPLETELY! I SENT IT OUT TO PEOPLE AND THEY UNDERSTODD IT TOO!.
Liar’s like Biden do not!
REMEMBER THE STOCK MARKET IS NOW GLOBAL AND THAT IS OK AND NOT, BUT THE WAY IT HAS TOO BE TODAY! SO CLAIMS HE IS DRIVING THE MARKET ARE FALSE!
VOITE YOUR POCKET BOOK IF YOU STILL HAVE ONE!
GROSS INFLATION IN FOOD PRICES SINCE BIDEN GOT IN THE OFFICE OVER 50% AND MORE TO COMEBECUASE OF EWHAT BIPDEN IS DOING!
GOT GAS!
I have repeatedly asked ADP to account for duplicate social security numbers but they won’t. Amusingly, the BLS wants to, but the employees tell me they can’t because “they don’t have access to the data for security reasons.”
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Even if the same person is working 2 jobs, it is still 2 jobs.
Government plus private education and health added 159,000 of the 303,000 jobs in the establishment survey. Most of that is related to the surge in illegal immigration.
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IIt’s easy to make whatever claims you want without evidence.
As much as some might hope for a recession, these jobs numbers are nowhere near it. Employment is stable and picking up across the board for actual productive jobs (not FIRE industries).
Farm payrolls must be crushing it given all the job growth is related to illegal immigration.
Iranian retaliation against the gangster state might cause a reaction.
I just added 3 jobs to the economy today. I played guitar at the nursing home for an hour and they gave me a $25. check. I took some neighbors to the food bank today and they gave me a cornbread. I put out and took in the garbage cans for the other neighbor and he gave me a Stewart’s coffee.
I need a tax accountant to figure out what I owe now.
Helping your fellow man. Always a good thing. A pat on the back for you.
I think its time I pick up a 4th job in order to afford food.
He has cornbread and coffee. What else does he need.
From the kids movie, the four basic food groups are beans, bacon, whiskey, and lard.
So there are a few more errands to run.
Worse than that, bacon falls into the lard group and on such a diet, you won’t be “running” any productive errands.
I thought the stock market would have reacted negatively to this report since it hurts the rate cut narrative. But apparantly goods news is good news and bad news is good news. You can’t lose!
We must cherry pick our bad news to get a drop in Markets. So far, it has to be an assassination or a 911 or ???
I wonder if the fed pumps in the morning and dumps in the afternoon after building momentum.
Yup. Higher rates will slow the markets…some day. Sigh.
Nope. Higher rates have helped savings which helps investment. Those with cash are in a better position today than those with debt.
That’s because corporate profits continue to be strong and the market saw an expected number to the upside. Keep hoping for that recession.
Bad news and rate cuts were good for technology stocks. Good news is actually good for commodity stocks , industrials. and such. Money is rotating.
This is simply another way to make the populous dependent upon the government.
Guess who gets blamed when the budget blows up and all these people loose their jobs. Not one side of the isle as the politico’s will allow them to keep their jobs if they just vote for them.
i still think this is reclassifications — it should be stopping about now since the rule went into effect in January