Friday, October 8, 2010

Employment Report: More of the Same

I could swear this months report is a carbon copy of the basic situation from last month's report. Basically, modest private sector hiring is offset by big losses in the government sector.

Let's look at the details, starting with the household survey.

The civilian, non-institutional population (everybody over 16 who isn't in jail or in the military) increased 223,000. This numbers is the denominator in a a lot of calculations. The civilian labor force (all employed and unemployed persons) increased 48,000. As such, the participation rate -- the percentage of people who are "participating" in the work force was unchanged at 64.7%.

The number of employed people increased 141,000 while the number of unemployed decreased 93,000.

Turning to the establishment survey, we get the following:

Total, non-farm employment decreased 95,000, but that is the result of a loss of 159,000 in the government employment area. Goods producing industries lost 22,000, largely as a result of a 21,000 drop in construction employment and a 6000 drop in non-durable goods employment. service sector employment increased 86,000, which was largely caused by an increase of 32,000 in health care and social services and a 38,000 increase in leisure and hospitality employment.

Government employment dropped by 159,000, which was evenly split between federal (76,000) and local (76,000).

Average weekly hours remained constant, average hourly earnings increased .01 (a penny) and average weekly earnings increased from 639.52 to 639.85. The index of aggregate weekly hours increased from 99.5 to 99.6.

As I said up top, this sure looks like the last employment report.

On a scale of 1-10, this is a 3.5 at best. There is some hiring, but nowhere near enough.

NDD here: Two things about the September report jumped out at me. (1) is the continuing local government job losses. As I have noted before, the refusal to extend budget help to the states means that layoffs that would have happened a year ago, are happening now instead. In contrast, virtually all other areas showed job gains. (2) is the continuing divergeance between the Establishment and Household surveys. The former showed -95,000 while the latter showed +141,000. The Establishment survey is showing less than 650,000 jobs added to the economy all year, while the Household survey shows almost +2,000,000! This is a huge divergeance.