Courtesy of Mish.
Initial Reaction
Counting the upwardly revised 298,000 nonfarm payroll report in June (originally reported as 288,000), this was a decent report.
Yet, digging into the details, the household survey showed a gain in employment of only 131,000. Thus, for the second consecutive month, the household survey was substantially weaker than the headline number.
The unemployment rate rose by 0.1% (by 197,000) thanks to a rise in the labor force greater than the rise in employment.
May BLS Jobs Statistics at a Glance
- Nonfarm Payroll: +209,000 – Establishment Survey
- Employment: +131,000 – Household Survey
- Unemployment: +197,000 – Household Survey
- Involuntary Part-Time Work: +275,000 – Household Survey
- Voluntary Part-Time Work: -33,000 – Household Survey
- Baseline Unemployment Rate: +0.1 at 6.1% – Household Survey
- U-6 unemployment: +0.1 to 12.2% – Household Survey
- Civilian Non-institutional Population: +209,000
- Civilian Labor Force: +329,000 – Household Survey
- Not in Labor Force: -119,000 – Household Survey
- Participation Rate: +0.1 at 62.9 – Household Survey
Additional Notes About the Unemployment Rate
- The unemployment rate varies in accordance with the Household Survey, not the reported headline jobs number, and not in accordance with the weekly claims data.
- In the past year the working-age population rose by 2,226,000.
- In the last year the labor force declined by 330,000.
- In the last year, those “not” in the labor force rose by 1,939,000
- In the past year, the number of people employed rose by 2,067,000 (an average of 172,250 a month)
Please note that over the course of the last year, the working-age population rose by more than the number of people employed. In normal times, the unemployment rate would have gone up slightly. Instead, the unemployment rate fell from 7.3% to 6.2%. Over 100% of the decline in unemployment was due to people dropping out of the labor force, rather than strength in the economy!
July 2014 Employment Report
Please consider the Bureau of Labor Statistics (BLS) July 2014 Employment Report.
Total nonfarm payroll employment increased by 209,000 in July, and the unemployment rate was little changed at 6.2 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services, manufacturing, retail trade, and construction.
…
