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According to the Bureau of Labor Statistics, nonfarm payroll employment increased by a comparatively strong 206,000 in June following the prior month's gain of 218,000 jobs. However, sentiment about the labor market appears to be softening. In the latest Macro Minute, the weekly blog that explores the numbers behind the headlines on the national economy, John O'Trakoun, a senior policy economist, explores some ways of visualizing the breadth of recent jobs growth across industries. Read about this growth here, including the Lorenz curve, a graph first used by economist Max O. Lorenz to show inequality in the distribution of income or wealth: https://bit.ly/3Y63Lsh #MacroMinute #Employment #LaborMarket

We have the preliminary benchmark estimate out of the Bureau of Labor Statistics, which suggests job growth in the year to March 2024 was 818,000 lower than initially estimated. This estimate will, ironically, also get revised in the coming months. (It gets applied to the historical time series in early 2025 and then gets set in stone.) But assuming it doesn't change: this means the initial tally of 242K per month of job growth from March 2023 to March 2024 gets knocked down to something like 175K. That's still a solid growth rate. How much should this downward revision worry you? If you've been following the jobs data holistically, not much. We know that on balance the labor market has been gradually cooling over the past year. That's worth worrying about at least a little, and it's true whether job gains are 242K per month or 175K per month. We have more timely data already in hand that's less susceptible to revisions. If you've been looking exclusively at gains in nonfarm payroll employment, you should probably be more worried. Looking at those exclusively you would have concluded erroneously that the job market was hot. Anyway, onto the next jobs report! It comes out in two weeks.

The January Job Openings and Labor Turnover Survey (JOLTS) continues to suggest a generally strong labor market that is cooling gradually. “Churn” in the labor market, which I proxy as the sum of hires and quits as a percent of the labor force, remains somewhat elevated compared to its full history, but it continues to move lower and for several months now has been below levels seen just before the pandemic. This reflects the ongoing reduction in job openings, but also the fact that the wage premium for switching jobs has returned to pre-pandemic levels. I also wonder if the large pool of workers that switched jobs in 2021 and 2022 is particularly reluctant to engage in yet another job transition, unless the wage premium were to be especially compelling. Big picture, the JOLTS data continue to point towards moderate levels of real wage growth, which should be supportive of inflation continuing to cool.

The U.S. Bureau of Labor Statistics' March employment report indicates significant growth, with non-farm payroll employment rising by 303,000 jobs, surpassing the previous 12-month average of 231,000. Key sectors driving this growth include health care, with a 72,000 job increase; government, adding 71,000 positions; and construction, which saw 39,000 new jobs. Notably, the leisure and hospitality sector matched its pre-pandemic levels with a 49,000 job increase, signaling a recovery from the early pandemic's severe impact. The "other services" industry and social assistance also reported employment gains, albeit at varying rates. Retail trade showed a slight improvement, while sectors like mining, manufacturing, and transportation maintained stability. Wage growth accompanied this employment surge, with average hourly earnings for all private non-farm employees rising by 12 cents to $34.69, a 4.1% year-over-year increase. Additionally, the average workweek slightly extended to 34.4 hours, with manufacturing hours remaining steady. Revisions of previous months' data revealed a net increase of 22,000 jobs, adjusting January's figures upward and February's downward. Overall, the March report showcases a robust labor market with significant sectoral employment increases, wage growth, and minor adjustments in work hours, highlighting a strengthening labor market. #Economy #Employment

In its establishment survey, the Bureau of Labor Statistics (BLS) reported that US non-farm payrolls rose by 272,000 in May, a pace higher than expected and the revised 165,000 rise in April. Although slower pace than earlier in the year and 2023, this is still a solid gain, one above long-term trends in population. This gain contrasts with the decline in employment as measured by the household survey. Employment continued to trend up in many industries, led by health care, government, leisure and hospitality, and professional and business services. A solid gain occurred in construction and manufacturing employment edged up. The report contains some metrics that serve as leading indicators of the economy. Average weekly hours in manufacturing rose to 40.8 hours; trucking employment fell again; and employment in temporary help services was essentially stable. This is a mixed picture. My preferred measure of labor costs is average private sector hourly earnings for non-supervisory production workers and that moved up to $29.99 per hour, an all-time high and a level up 4.2% y/y. This is at a pace above that of inflation and suggests that wage pressures continue. This likely closes any window for a rate cut this summer.

In its establishment survey, the Bureau of Labor Statistics (BLS) reported that US payrolls expanded a larger-than-expected 303,000 jobs, marking 39 months of gains. Sizable job gains occurred in health care, government, retail trade, and construction. Leisure and hospitality employment improved as well and is now back to pre-COVID levels. Manufacturing employment was flat. The average hourly wage for non-supervisory workers moved up to $29.79 per hour, a level up 4.2% y/y. The establishment report also contains some measures that by themselves are leading economic indicators. The average workweek in manufacturing moved up as did payrolls in trucking. On the other hand, temporary help services fell again. The household and establishments surveys both agree on gains in employment. The labor market is not faltering, and this is positive. The doesn’t certainly merit any change in thinking about the Fed raising interest rate but July (or later) looks more likely for any rate cuts. On the other hand, watch the price of oil as commodity markets appear to be signaling stronger economic growth. 

This is just me thinking out loud. I find I keep coming back to this issue in the US with the two labour market surveys telling quite different employment stories. The establishment survey (payrolls) is continuing to show solid employment growth while the household survey is weak with employment falling. Could it be that some people have more than one job, so that one person employed in the household survey may have two or three jobs in payrolls data? Or could it be, as I read some analysts postulating after last weeks data, that the household survey is struggling to keep up with strong immigration flows and so employment is understated in that survey? Which one is right matters for the Fed as wages are a key determinant of inflation outcomes, especially in sticky services. Wage growth (private sector average hourly earnings) is currently stuck at a tad over 4% per annum. That seems to be too high unless you’ve got strong productivity growth. Well, guess what? Latest data shows US labour productivity running at an annual pace of +2.6% with unit labour costs running at +2.5%, which is not far off being consistent with 2% inflation. I should add the labour input for the productivity calculations comes from total hours worked in the payrolls survey, so to the productivity data is only reliable to the extent you think the payrolls data is reliable. It will be fascinating to see whet the FOMC makes of all this. We don’t expect the Committee to do anything to interest rates at their meeting next week, but a careful reading of the minutes a couple of weeks later might be enlightening.

The Bureau of Labor Statistics (BLS) reported that in its establishment survey, reported that non-farm payrolls increased by 206,000 in June. Moreover, the May and April gains were revised lower. The average monthly gain over the last 12 months is 220,000 so this gain is rather close to the trends of the last year, which represents a slowing from the post-COVID recovery of jobs. This slowing was expected, and the gain was largely in line with expectations. In June, job gains occurred in government, health care, social assistance, and construction. Mining employment was flat and manufacturing jobs eased as did retail trade and professional and business services. During June, the average hourly wage for private-sector non-supervisory production workers exceeded $30 per for the first time, and was up 4.0% y/y. The latter is a pace above inflation and is contributing to real wage gains, which will support consumer incomes and spending. Aggregated hours worked eased but one month does not make a trend. Within the establishment report are data that serve as leading indicators of the economy. Employment in temporary help services fell, trucking employment was essentially stable, and the average workweek in manufacturing ticked up. In other words, another mixed take. The labor market is slowing. We’ve been saying would for well over a year.

While US wage growth is still elevated compared to pre-pandemic levels, recent data from Indeed’s Wage Tracker points toward a continued slowdown. Hiring Lab’s January 2024 Labor Market Update https://lnkd.in/ge3ifwTP shows wages grew 3.8% year-over-year in December, down from 9.3% at its peak almost two years earlier. On its current trajectory, posted wage growth would descend to 3.5% by February, and its pre-pandemic average of 3.1% by May this year. #LaborMarket #Indeed #HiringLab

#US #Labor #Data shows increase in #unemployment- April data from the Bureau of Labor Statistics indicates a slowdown in the US labor market. Nonfarm payrolls increased by 175,000, below economists' expectations of 240,000. Unemployment rate rose to 3.9%, contrary to forecasts of remaining at 3.8%.