PAYROLL JOBS | Rise by 1.4 million in August, as expected

September 4, 2020—Nonfarm payroll jobs rose by 1.4 million in August, showing modest recovery in depressed sectors like retail trade and leisure-hospitality. Education+health also increased, reflecting the beginning of return to the academic calendar. 

Temporary workers were a factor, as the Census Bureau hired 238,000 temporary Census takers, a large factor in the growth of government jobs. Professional+business services turned to temporary-help services for 107,000 new workers; this sector is still 1.5 million jobs below its February level.

More information at https://www.bls.gov/news.release/jec.nr0.htm.

P.S. September 5—NY Times coverage here: https://www.nytimes.com/2020/09/04/business/economy/jobs-report.html

VIEWS | 470K. Top Ten Most Read

May 27, 2020—CityEconomist has had 470,000 page views since it was opened. Thank you for reading.

The most-viewed CityEconomist post during the last month was Irish writer Fintan O'Toole's commentary on the pitiful situation of the United States in its dealings with the rest of the world.

In second place was CityEconomist's endorsement of Perry Gershon, one of three candidates for NY-1 in the June 23 Democratic Primary. Here are the ten most-viewed posts.

IRELAND | USA More to Be Pitied than Scorned Apr 27, 2020

PERRY GERSHON | Primary, June 23 May 24, 2020

UNIONS | Oct. 18–First American Trade Unions, 1648... Oct 18, 2013

BOARD OF ELECTIONS | What's the Matter? Oct 13, 2013

GERMAN ELECTIONS, 1933 | How a Democracy Was Destr... Mar 5, 2017

JOBS BY STATE | Every state lost jobs. CA, NY, TX ... May 22, 2020

JOBS | Trump Compared with Obama, GW Bush, Clinton... May 8, 2020

TRUMP'S TRADE WAR | How the Détente Magnified the ... Apr 27, 2020

LABOR DEPARTMENT | "Breathtakingly Cruel" Guidance... Apr 28, 2020

PANDEMIC | Online Free Resources, Alphabetized! Mar 21, 2020, 1 comment

JOBS BY STATE | Every state lost jobs. CA, NY, TX lost the most.

This map is interactive at the source (BLS).

May 22, 2020—In April 2020, jobs (nonfarm payroll employment) decreased in every one of the 50 states and in the District of Columbia.

The most-affected states were primarily ones with more population and more density.

States with Largest Job Losses

The three states with the largest job declines were California, New York and Texas.

California lost 2.34 million jobs, New York lost 1.83 million (more precisely, 1,827,300 net nonfarm payroll jobs) and Texas lost 1.30 million.

The three states with the largest percentage loss of jobs were Michigan, Vermont and New York. Michigan lost 22.8 percent of its jobs. Vermont lost 19.6 percent and New York lost 18.8 percent. See Tables E and 3 of the Bureau of Labor Statistics release this morning.

Which Sectors Lost the Most Jobs in New York State?

The hardest-hit industry sector in New York was Leisure and Hospitality, which lost, between March and April 2020, 548,500 jobs, or 64.1 percent of all of its payroll jobs in New York State. This of course reflects Governor Andrew Cuomo's well-advised shutdown order.  Health care workers and teachers jobs declined by much less, only 10.9 percent. Financial and information services, and government, appear to have maintained their staffing, presumably through use of the Internet.

Industry	March	April	Decline	Percent decline
Mining and Logging	4.8	4.8	0.0	0.0
Construction	383.8	234.1	149.7	39.0
Manufacturing	435.9	355.3	80.6	18.5
Trade, Transport, Utilities	1,513.0	1181.5	331.5	21.9
Information	275.8	267.5	8.3	3.0
Financial Activities	700.5	685.6	14.9	2.1
Professional and Biz Svces	1,373.1	1178.3	194.8	14.2
Educational, Health Svces	2,182.1	1944.9	237.2	10.9
Leisure and Hospitality	855.9	307.4	548.5	64.1
Other Services	411.6	291.1	120.5	29.3
Government	1,500.1	1438.9	61.2	4.1
Total	9,636.6	7,889.4	1,747.2	18.1

Source: BLS data (first two columns), computations (second two columns) by CityEconomist. The BLS payroll data by state are not seasonally adjusted.

Over the past twelve months (April 2019 to April 2020), New York lost 1,904,900 payroll jobs. In April, New York’s private sector lost 1,764,600 private payroll jobs compared with March, and over the past twelve months it lost 1,845,700 private payroll jobs.

Trajectories by State

Imperial College of London has published a tracking report for each U.S. state that shows how the trajectory of outbreaks diverges. At the time of release, 24 states, mostly in the midwest and south, had “uncontrolled” outbreaks, meaning the reproduction (infection) rate of the virus was above 1.

Unemployment by State

The unemployment rate in April rose to the highest level in Nevada, 28.2 percent, followed by Michigan, 22.7 percent, and Hawaii, 22.3 percent. The rates, which are seasonally adjusted, set new series highs in 43 states. All state series begin in 1976. The information is from the Bureau of Labor Statistics this morning, along with an interactive map of state unemployment rates.

Unemployment rates in Hawaii and Nevada exceeded their previous series highs by more than 10.0 percentage points each. Connecticut had the lowest unemployment rate, 7.9 percent. All together, 27 states and the District of Columbia had unemployment rates lower than the national average of 14.7 percent and 10 states had higher rates (the other 13 state rates were not significantly different from that of the nation). This information is in Tables A, B and 1 of the BLS release.

In April, the largest unemployment rate increases occurred in Nevada (+21.3 percentage points), Hawaii (+19.9 points), and Michigan (+18.4 points). Rates rose over the month by at least 10.0 percentage points in an additional 17 states. The smallest over-the-month jobless rate increases occurred in Nebraska (+4.3 percentage points) and Connecticut (+4.5 points). This information is from Table C in the BLS release.

The largest unemployment rate increases from April 2019 occurred in Nevada (+24.2 percentage points) and Hawaii (+19.6 points), and Michigan (+18.4 points). Another 21 states experienced increases of 10.0 points or more. The smallest over-the-year rate increases occurred in Connecticut (+4.2 percentage points) and Minnesota (+4.9 points). See Table D in the BLS release.

New York's unemployment rate rose by 10.4 percentage points to 14.5 percent in April. New York’s labor force participation rate fell to 58.3 percent in April from 60.2 percent in March.

SUFFOLK, NY | Job Growth – A Zero for Zeldin

Source: Bureau of Labor Statistics, data released May 23,
2018. www.bls.gov.

The Congressman from CD 1 in Suffolk County, New York, was first elected in 2014, and reelected in 2016. 

He has made creating jobs a central part of his program, one of the main issues highlighted on his own web site.

He said in 2016 he would go to Washington, work with the Tea Party to reduce environmental and other regulations, and "help grow our economy and create more good paying jobs".

So how's it going with that, Mr. Zeldin?

Numbers just came out today for the fourth quarter of 2017. They show that Suffolk County ranked 309th out of the 347 largest counties for growth during 2017, comparing fourth quarter 2017 with the fourth quarter of the previous year.

The growth rate was Point One Percent. That's one-tenth of one percent. That is statistically equivalent to Zero.

Compare that with Brooklyn (King's County), which grew 41 times as fast, 4.1 percent, and ranked 14th out of the 347 largest counties.

Zeldin has had two terms to prove he can make a difference in job growth. I would say he flunks his own test. He has not helped grow the economy. He has not "created more good-paying jobs". Time's up!

JOBS | Average Increase Nov-Jan, 192,000

Nonfarm Payroll (BLS)

Total nonfarm payroll employment rose by 200,000 in January. However, the net increase in total nonfarm payroll employment was revised down for November-December:

• The November increase was revised down from 252,000 to 216,000.
• The December increase was revised up from 148,000 to 160,000.
• The net change was that gains in payroll jobs in November and December combined were 24,000 fewer than previously reported.
• After revisions, job gains averaged 192,000 per month over the last 3 months. A moving average is more reliable for payroll job changes. Each month, prior data is revised based on additional reports and recalculation of seasonal factors. Noise in the reported numbers is especially likely during the annual BLS benchmark process at the end of each  year.

Employment continued to trend up in construction, food services and drinking places, health care, and manufacturing:.

• Construction added 36,000 jobs in January, with most of the increase occurring among specialty trade contractors (+26,000). Employment in residential building construction continued to trend up over the month (+5,000). Over the year, construction employment has increased by 226,000.

• Food services and drinking places employment continued to trend up in January (+31,000). The industry has added 255,000 jobs over the past 12 months.

• Health care continued its long and steady record of adding jobs in January (+21,000), with a gain of 13,000 in hospitals. In 2017, health care added an average of 24,000 jobs per month.

• Manufacturing continued to add jobs (+15,000). Durable goods industries added 18,000 jobs. Manufacturing has added 186,000 jobs over the past 12 months.

• Other major industries were little changed, including mining, wholesale trade, retail trade, transportation and warehousing, information, financial activities, professional and business services, and government.

The average workweek for all employees on private nonfarm payrolls declined by 0.2 hour to 34.3 hours in January. In manufacturing, the workweek declined by 0.2 hour to 40.6 hours, while overtime remained at 3.5 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged down by 0.1 hour to 33.6 hours.

In January, average hourly earnings for all employees on private nonfarm payrolls rose by 9 cents to $26.74, following an 11-cent gain in December. Over the year, average hourly earnings have risen by 75 cents, or 2.9 percent. Average hourly earnings of private-sector production and nonsupervisory employees increased by 3 cents to $22.34 in January.

The January unemployment rate was 4.1 percent for the fourth consecutive month. The number of unemployed persons was 6.7 million, changed little over the month. Full data are at www.bls.gov. Among major worker groups, the unemployment rate for Blacks increased to 7.7 percent in January, and the rate for Whites declined to 3.5 percent.

In January, 1.7 million persons were marginally attached to the labor force, little changed from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 451,000 discouraged workers in January, little changed from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.2 million persons marginally attached to the labor force in January had not searched for work for reasons such as school attendance or family responsibilities.

HOSPITALS | Outlook Is Worrisome

Good Luck to You I just read the following article posted by Dr. David Posnett today and I am re-posting by permission. At the end I have some brief comments.  – John Tepper Marlin, CityEconomist Short Hospital Stocks! by D. Posnett MD   East Hampton, N.Y., October 10, 2017– I have been waiting for this. Wall street charts show that investors are jittery about hospital stocks.  Here is why:

(1) Investors are approaching hospital stocks cautiously. Les Masterson said earlier today:

Some unfavorable financial trends and an air of uncertainty for healthcare’s future has led to an environment not particularly friendly for major investment… as hospitals continue to struggle with fewer inpatient admissions, lower reimbursements and potential increases in uncompensated care, investors are growing wary.

The current environment caused disappointing second quarters and lower earnings projections for major for-profit systems like HCA, Community Health Systems (CHS) and Tenet Healthcare…. The results led stock prices to tumble.

I would go further and add two more disturbing facts:

(2) Hospital Sector Slides. The Financial Times notes that US hospital operators' stock prices are sliding down  following a report that President Donald Trump will sign an executive order this week to withdraw some insurance requirements laid out under Obamacare. Tenet Healthcare, Community Health Systems, Surgery Partners, HCA Healthcare, DaVita shares tumbled lost up to 10% in stock prices.

(3) Some are suggesting "Checking in on the Canadian Healthcare Stocks".

My Comment (CityEconomist)

It's not just the stock market. If hospitals are heading into lean times, then one of the engines of job growth since 2009 will be knocked out. 

Even during the recession before that, the health care industry was growing jobs steadily. When this juggernaut goes into reverse... watch out, America.

SUFFOLK, NY | Disappointing 1Q17

Suffolk County, N.Y.

The first-quarter county data came out from the Bureau of Labor Statistics this morning (http://bit.ly/2wFDNPd), showing how Suffolk County is doing on jobs and wages.

Average employment in the county rose 0.6 percent, up slightly from the first quarter of the previous year, but not as much as most other counties. Suffolk ranked #259 out of 347 large U.S. counties, on the edge of the bottom quartile.

Manhattan jobs, by comparison, rose 1.3 percent, closer to the median county average. Brooklyn jobs rose 3.2 percent, which ranks #34, in the top tenth of the large counties.

Suffolk average wages rose 5.1 percent, ranking #260 out of the 347 counties, which puts it in the bottom quartile. In Manhattan, by contrast, wages rose 6.3 percent, again putting the county in the middle of the ranking.

JOBS | Suffolk County, NY

How is Trump doing?

In 2010, Randy Altschuler attacked the incumbent congressman from Suffolk County, NY, Rep. Tim Bishop, for not doing enough for the Long Island economy.

He said that 30,000 jobs had left Long Island during Bishop's incumbency. I pointed out in an article on Huffington Post that the number was a lie. The correct figure was a gain of 36,000 jobs. Altschuler stopped using the number, but not until after he sent a glossy card to every voter with the lie plastered all over it.

Lee Zeldin was next to campaign against Bishop, in 2008. He lost badly in a Republican-leaning district. But in 2014 he adopted a straight Tea Party program, one of the first campaigners to do this. Here were his four main programs:

1. Oppose raising the Federal minimum wage.
2. Curtail Medicaid benefits. 
3. Simplify the Federal tax code and cut taxes on the rich. 
4. Cut Federal spending.

Zeldin was one of the first of the Tea Party electeds, in 2014. The GOP gained a majority in both the House and Senate in the 114th Congress, 2015-16. So how have Zeldin and the GOP Congress been helping Suffolk County? Let's ignore the first year, during which Zeldin was finding out where the bathrooms are in the maze of Capitol offices. Few Members of Congress make a dent in Washington in their first year (one reason for respecting seniority). Let's look at the second year of his term of office. How has the Suffolk County economy performed in 2016?

County-level numbers for jobs and wages are released quarterly and the numbers for the fourth quarter of 2016 were just released by the BLS on Wednesday. Here is the story for Suffolk:

Jobs. Suffolk's nonfarm payroll jobs rose to 661,400 in the fourth quarter of 2016, an increase of 900 jobs.

That's fewer than 1,000 jobs, compared with Bishop's presiding over growth of   36,000 jobs when he was attacked by the GOP for not doing enough for the economy.

The tiny growth rate during 2016 ranks 205th of 345 large counties for which the BLS computes this information, about 60 percent down the list. Within New York State, the growth rate is in the bottom half of the 18 large counties on the BLS list.

Wages. But maybe, has the quality of the jobs improved under Zeldin? What has happened to weekly wages? The news is much worse. Wages in Suffolk County declined by 3.5 percent, placing the county 289th out of 345 large U.S. counties, i.e., in the bottom fifth. Only two counties out of the 18 in New York State did worse.

This is not a good record. Since November 2016 the GOP has not only Congress but the White House, and a president who promised more jobs. We are waiting and watching.

JOBS | March Disappoints (Updated Apr 8, 2017)

The 1990s saw steady job growth with Bill
Clinton and in 2009-2016 with Obama.
Sources: BLS, FRED (St Louis Fed).

March 7, 2017—The BLS reported this morning on the March jobs data.

Total nonfarm payroll employment rose by only 98,000 in March, following gains averaging 217,500 in January-February 2017.

Professional and business services continued to grow (+56,000), as did mining (+11,000). These are good-paying jobs:

• Services to buildings and dwellings (+17,000) and architectural and engineering services (+7,000) did well. 
• Most of the gain in mining occurred in support activities (+9,000). Mining employment has risen by 35,000 since a recent low in October 2016.

However, retail trade lost jobs (-30,000). Competition from the Internet is likely hurting bricks-and-mortar retailers. Employment in general merchandise stores declined by 35,000 in March and has declined by 89,000 since a recent high in October 2016. The good news is that with higher levels of technology the jobs that remain are better paid.

Health care continues to create jobs, as it has for decades, added 14,000 in March, with gains in hospitals (+9,000) and outpatient care centers (+6,000). In the first 3 months of this year, health care added an average of 20,000 jobs per month, compared with an average monthly gain of 32,000 in 2016.

Financial activities, the best-paying jobs, continued to trend up in March (+9,000) and jobs in the sector have increased by 178,000 over the past 12 months.

Construction employment changed little in March (+6,000), following a gain of 59,000 in February. It has been trending up since late last summer, largely among specialty trade contractors and in residential building.

Postscript (Saturday, Apr 8, 2017)

Neil Irwin in The New York Times today (p. B2) says that "it was a mistake" for Trump to point out the strong growth in jobs in February, because he drew attention to a number that in March didn't work out so well for the new administration.

Irwin goes on to say that payroll jobs are not the best economic indicator...

What? Trump promises more jobs, and he shouldn't focus on the monthly job numbers? I have been working with the job numbers for a long time, and I don't think Irwin is correct in advising the President to shift attention away from them, certainly not at this early stage.

Trump's biggest campaign commitment was to "Jobs, Jobs, Jobs". The number he has to beat is payroll jobs as shown in the chart below. Sure, these numbers are revised periodically, but they are the coin of the realm. BLS collects job numbers from each state based on unemployment insurance filings within each state. If a monthly number is out of line, it gets looked at more carefully. These numbers are well grounded.

Irwin's two alt monthly job numbers, by contrast, are not so well grounded—

• Yes, the employment/population number is a good way of comparing long-term job-creating performance, because it eliminates issues involved in unemployment questions asked of the survey respondents in each sampled household. ("Who is not working? Have they been recently looking for work?") It is more resistant to survey-question creep. But the denominator, population, is not a reliable number for month-to-month comparisons.
• No, probably, to Irwin's proposal to pick age groups within the employment/population ratio. It would require tagging each unemployment insurance report with a year of birth and dividing the monthly job change according to age groups. Maybe this could be done—or the numbers could be estimated based on a sample—but will the new information be worth the effort? Might be something for a state government with a strong Unemployment Insurance staff to experiment with.
• Yes, finally, tracking wages is indeed important. We know that real wages over the long term have been falling in manufacturing as American factories compete with lower-wage supplies in other countries. But the real hourly earnings of private-sector employees is an aggregate of many different private-sector stories and is less useful for measuring the President's progress toward his stated goal than the aggregate job numbers. A rise in wages may simply reflect fewer jobs in a low-paying industry and more jobs in a higher-paying industry. The quarterly census of jobs and wages is conducted only quarterly and is published with a substantial lag that diminishes the value of the numbers. (But better late than never, and better late than inaccurate.)

Related Posts

Phony Numbers? . Job Numbers for Trump to Beat . Economic Hotspots

Job Growth by Month since the post-Glass-Steagall Meltdown of 2008.

JOBS | Two Job Numbers for Trump to Beat (Updated Jan. 6, 2017)

Trump visits Obama at the White House. 

It is understood among the cognoscenti that the Democrats managed the economy better for most Americans than the Republicans in the new millennium.

The problem for the Democrats in the 2016 election was voters who switched parties between 2012 and 2016. They were predominantly non-college-educated, from the least-well-educated states.

They picked up on the plain-language appeals and promises of candidate Donald Trump. The Democratic arguments were pitched to their college-educated base.

Perhaps the Democratic appeal to voters should have been based on a smaller number of performance indicators. President-elect Trump has promised to increase jobs. Two broad indicators–as opposed to anecdotal evidence from individual companies–might suffice to measure the success of his administration.

We can even use the BLS November job numbers [Jan. 6, 2017: see below for update, which changes little] for clear and independent benchmarks against which the economic performance of our presidents can properly be measured. The final report on the Obama Administration will be issued on January 6, subject to revision, but the December numbers, based on November reporting (and prior months for their seasonal adjustment), are not likely to change much from November.

Two Key Indicators

Here are the two key long-term numbers against which Obama's economy can be compared with the Bush economy of eight years ago and the Trump economy of two and four years hence:

1. Unemployment =  a rate of 4.6 percent in November

This is arrived at by dividing the number of unemployed, 7.4 million in November, of whom 1.9 million have been unemployed for 27 or more weeks, by the labor force (employed + unemployed), 159.5 million.

This compares with 7.3 percent in December 2004, the last month of the George W. Bush administration. (The numbers are easily found by punching into Google the two words  Unemployment and FRED. This will take you to the super-user-friendly St. Louis Fed database, God bless them.) That is a reduction of 2.7 percentage points. This compares with an increase of 3.4 percentage points during the Bush 43 administration and a decrease of 3.5 percent during the Clinton administration:

• Clinton vs. Bush 43: Better by 3.5 - (-3.4) = 6.9 percentage points.
• Obama vs. Bush 43: Better by 2.7 - (-3.4) = 6.1 percentage points.

2. Employment-population ratio = a rate of 59.7 percent in November.

This number is arrived at by dividing the number of civilian noninstitutional employed, 152.1 million, by the civilian noninstitutional population, 254.5 million.

This number is solid for long-term comparisons because it is not affected by answers to the unemployment survey. The labor force participation rate is dependent on the unemployment rate in the definition of the labor force. The employment-population ratio is not affected by any long-term change in the definitions of the unemployed or in the conduct of the monthly surveys of the labor force.

In December 1992 when President Clinton came to office, the employment-population rate had been falling and was at 61.4 percent. It rose during his administration to 64.3 percent, an increase of 2.9 percentage points. Under G. W. Bush, the rate fell by 3.3 percentage points to 61.0 percent. Under Obama the rate fell further to 59.7 percent, a drop of 1.3 percentage points. So here is the record of this measure:

• Clinton vs. Bush 43: Better by [2.9 - (-3.3)] = 6.2 percentage points.
• Obama vs. Bush 43: Better by [3.3 - 1.3] = 2.0 percentage points.

On both measures, the last two Democratic administrations outperformed the Bush 43 administration, by a lot.

Update, Jan. 6, 2017

Here are the final numbers for November, which arguably should still be the baseline, seasonally adjusted, if the incoming President wants to take credit for changed expectations in December (or his opponents do). Here also are the December seasonally adjusted numbers. Either way, from here on, it is President Donald Trump's baby–TrumpCare, TrumpEconomy and all.

JOBS | Opening for Labor Economist, MA Level

POSITION ANNOUNCEMENT

Full-Time Senior Research Associate

The New York City Labor Market Information Service (NYCLMIS), housed at the Center for Urban Research at the CUNY Graduate Center, seeks a full-time senior research associate to work as part of a team that performs research on jobs and the economy, prepares career planning informational tools, and provides strategic consulting. The overall function of the NYCLMIS is to help education, workforce  and economic development policy makers and practitioners to better align their programs and policies to the demands of the labor market  The heart of our work is a mission to advocate for strategies that improve opportunities for those at the bottom of the economic ladder.  For more information about NYCLMIS, see its  website at http://www/gc.cuny.edu/lmis.

With supervision and support from the director of the NYCLMIS and other senior staff, the data research associate will:

§  Analyze economic, labor market, labor force, and other data;

§  Conduct interviews and focus groups;

§  Write reports and briefs;

§  Create presentation materials;

§  Work on multiple projects simultaneously; and

§  Participate in other research and technical assistance activities as needed.

The qualifications NYCLMIC seeks include:
§  Master's degree and at least 3 years professional experience in a related research/policy role (experience may be substituted for education);
§  Strong quantitative skills including data cleaning, merging, analysis, and management:
-         Advanced facility with at least one statistical analysis software package (STATA, R, SAS, SPSS);
-         Experience using a wide variety of public data sources, like the American Community Survey the QCEW, and other New York State Department of Labor products; and
-         Ability to communicate research findings clearly to diverse audiences, including clear writing and production of charts and figures.

§  Experience collecting, analyzing and summarizing information using qualitative methods, such as document review and semi-structured interviews;
§  Familiarity with – or interest in –workforce development policies and programs; and
§  Experience working within a client-centered, team- and project-based environment.

Salary

NYCLMIS offers a competitive salary that is based on the candidate’s experience and skills. The full-time position comes with a generous benefits package including medical, dental, and vision coverage and – after one year of employment – participation in the RFCUNY retirement package.

Growth Potential

The right candidate will be able to take on or advance into other roles including conceiving and designing research projects for submission to competitive grants and directing projects in collaboration and support from the NYCLMIS director.

To apply, go to the RFCUNY Research Jobs web page, and search for PVN # GS-1603-001084 or “senior research associate” at the CUNY Graduate Center. Please be sure to include both resume and cover letter in your application. Only complete applications will be reviewed.

The Research Foundation of the City University of New York is an Equal Opportunity/ Affirmative Action/Americans with Disabilities act, E-verify employer.

JOBS | Retail Continues Strong in January 2016

The employment-to-population ratio has been
recovering. Source: BLS, Feb. 5, 2016.

Nonfarm payroll jobs rose by 151,000 in January, a falloff from the better months of late last year, the BLS announced this morning. Jobs continued strong in retail trade, food services and drinking places.

Despite a falloff in services–where job growth has for many years been more reliable than in manufacturing–health care continues strong as hospitals continue to grow. Credit the graying of America. Manufacturing has also shown good growth.

The bad news is concentrated in private educational services, transportation and warehousing. Mining jobs continued to decline, as the oil industry continues to suffer from the 70 percent drop in the price of oil compared with the peak in 2014.

Retail trade added 58,000 jobs in January, despite Walmart's report that it would close 269 stores worldwide, which translates to an eventual loss of 10,000 jobs.  Jobs grew by 15,000 in general merchandise stores, by 9,000 in electronics and appliance stores, by 8,000 in motor vehicle and parts dealers, and by 7,000 in furniture and home furnishing stores. Over the past 12 months, employment in retail trade has increased by 301,000, with motor vehicle and parts dealers and general merchandise stores accounting for nearly half of the gain. The death of brick-and-mortar retailers seems to have been exaggerated–in fact Amazon is planning to open its own brick-and-mortar outlets.

Other industries:

• Food and beverage establishment jobs rose 47,000 in January, bringing the total for the past 12 months to 384,000 jobs.
• Health care continued to add 37,000 jobs in January, with most of the increase, 24,000 jobs, being in hospitals. Health care has added 470,000 jobs over the past 12 months, two-fifths in hospitals.
• Financial activities rose by 18,000 jobs in January, the largest growth area being a 7,000-job increase in credit intermediation and related activities.
• Private educational services lost 39,000 jobs in January due to larger than normal seasonal layoffs. This sector has been plagued by revelations of debts and disappointments among students in delivery of value by some technical training programs promising good jobs at the end of the training.
• Transportation and warehousing decreased by 20,000 in January, mostly reflecting the most vulnerable job sector–couriers and messengers–whose numbers dropped by 14,000 in January after growing rapidly in the last two months of 2015.
• Professional and business services jobs rose by 9,000 after growing by 60,000 in December. The subcategory of professional and technical services continued to surge, adding 25,000 more jobs in January. Jobs in temp services rose more than the seasonal adjustment in December and fell by the same number in January.
• Manufacturing added 29,000 jobs in January, following little employment change in 2015. Over the month, 11,000 jobs were added in food manufacturing, 7,000 in fabricated metal products, and 3,000 in furniture and related products.
• Mining, which includes petroleum extraction, continued to decline by 7,000 jobs in January. Jobs peaked in this industry in September 2014 and have since fallen by 146,000 jobs (17 percent). More oil companies that over-invested in exploration are expected to go bankrupt.

JOBS | U.S. Boom Amidst Global Gloom

U.S. Job Growth Higher in December,
Unemployment still 5%. But will weak
 demand from overseas be exacerbated
 by a stronger dollar?

The just-released BLS jobs report for December [link is to the BLS News Release] shows payrolls rose by 292,000 in December. The good news will be much appreciated as Asia and Europe suffer from slack demand and pessimism.

Upward revisions for October and November reinforced the labor market strength in December, producing an average growth of 284,000 over the last three months, up from an average of 221,000 per month for the full year 2015.

Economists Underestimated December Growth. A Reuters survey of economists released an hour before the BLS data showed an average expected growth figure of approximately 200,000 new jobs.

With the upward revisions in the prior two months, that number was way off. Reuters should probably stop publishing predictions that will be contradicted within an hour. (How useful are they, really? To users and to those involved in the exercise?)

The U.S. "Misery Index" Is a Tiny 5.4 percent. We should be so happy. The unemployment rate in December was 5.0 percent for the third month in a row as inflation remains low– the November Consumer Price Index for all Urban Consumers (CPI-U) rose only 0.4 percentage point, seasonally adjusted, compared with November 2014.

Industry Detail. Professional and business services added 73,000 jobs in December, with nearly half the gain from growth in temporary help services, which rose 34,000. In 2015, employment in professional and business services increased by an average of 50,000 per month, not much below the 59,000-a-month figure in the strong year 2014.

Construction showed strong job growth for the third consecutive month. Health care also continued to add jobs in December and showed an even stronger year in 2015 than the year before. Employment in food services and drinking places increased by 37,000 in December, another bright spot.

Motion picture and sound recording industries added 15,000 jobs in December, offsetting a decline
in the previous month. Employment rose among couriers and messengers. Other sectors changed little.

Labor Market. Among people who were neither working nor looking for work in December, 1.8 million were classified as marginally attached to the labor force, down from 2.3 million a year earlier. The number of discouraged workers, a subset of the "marginally attached" who believed that no jobs were available for them, was 663,000 in December, little different from a year earlier.

The labor force participation rate, at 62.6 percent, has shown little change in recent months. The employment-population ratio, at 59.5 percent, has also changed little. The BLS has published a little noted article in December by Steven F. Hipple on the drop in the U.S. labor force participation rate since 2000. BLS counts people who are neither working nor looking for work as “not in the labor force.”  From 2004 to 2014, the percentage of such people has increased, reducing the labor force participation rate. Data from the Current Population Survey (CPS) and its Annual Social and Economic Supplement (ASEC) provide some insight into why people are not in the labor force. In the ASEC, people who did not work at all in the previous year are asked to give the main reason they did not work.

Interviewers categorize survey participants’ verbatim responses into the following six categories:

• ill health or disabled; 
• retired; 
• home responsibilities; 
• going to school;
• could not find work; and 
• other reasons. 

A quick summary of Hipple's article is: Between 2004 and 2014, all of these factors came into play, and a single factor goes a long way toward explaining what is happening–the aging of the work force. More workers are becoming disabled or retiring, at the same time as workers withdrawing from the labor force continue to cite the other reasons.