Payroll # misses mark, unemployment drops

[southsider2k5]

Boston, February 3: Headline job growth of 193k in January fell short of estimates but the 0.2 percentage point decline in the unemployment rate surprises. Earnings were higher than expected and the workweek was unchanged at 33.8 hours after December's figure was revised higher from 33.7 previously reported. More. -- jeoff.hall@thomson.com

 

The other thing is that they revised the December report up 81,000 jobs, or almost exactly to what they had expected that report to look like at the time...

[kapkomet]

4.7%? Wow. That's impossible...

[Texsox]

4.7%?  Wow.  That's impossible...

Must be all those Mexican illegals stealing jobs . . .

[kapkomet]

Must be all those Mexican illegals stealing jobs . . .

That was an inside joke for SS. Our econ prof used to tell us that below 5% unemployment was impossible to achieve.

[southsider2k5]

4.7%?  Wow.  That's impossible...

 

No that short tie over the gut is what is impossible...

[southsider2k5]

That was an inside joke for SS.  Our econ prof used to tell us that below 5% unemployment was impossible to achieve.

 

Below 5? s*** 6% was full employment back in 1994

[Texsox]

I've heard that also, but never as impossible. 5% was the people temporarily out of the workforce, not really working, unemployable druggies, employed in off the books jobs, etc.

[southsider2k5]

fyi, here is the full story

 

The U.S. unemployment rate fell to a 5-year low of 4.7% in January as 193,000 jobs were added to nonfarm payrolls, the Labor Department said Friday.

 

The January payroll figures fell short of expectations of a gain of 248,000, but with upward revisions to November and December of 81,000, the total payroll count was a bit more than expected.

 

"This report is much stronger than it first appears," said Ian Shepherdson, chief U.S. economist for High Frequency Economics.

 

"Despite the 'disappointing' headline, this is a strong report, with the theme again one of upward revisions," said analysts for Action Economics.

 

Payroll growth averaged 160,000 per month in 2005; it has averaged 229,000 in the past three months.

 

The drop in the jobless rate in January to the lowest level since April 2001 was a surprise: Economists surveyed by MarketWatch expected the unemployment rate to remain at 4.9%.

 

Bond yields rose on the news, bringing the yield on the 2-year note to 4.60%, the highest in more than five years. Stock futures fell. See Indications.

 

The decline in the jobless rate was due to benchmark revision of the household survey at the beginning of the year. Total employment was about 300,000 higher than in December, while unemployment was about 300,000 lower at 7 million. Read the full report.

 

Direct comparisons between December and January are not possible because of a break in the household data series. In essence, the government lumped all the revisions for the past year into one month.

 

Other details of the report showed a stronger labor market.

 

Average hourly wages rose 7 cents or 0.4% to $16.41. Economists expected a 0.3% gain. Average hourly earnings are up 3.3% in the past year, about the same as the inflation rate.

 

The average work week was steady at a revised 33.8 hours. Total hours worked in the economy increased 0.2%

 

Payrolls in the goods-producing sectors increased by 58,000, including 46,000 in construction and 7,000 in manufacturing. It's the third increase in factory jobs in the past four months.

 

Payrolls in the services sector rose by 135,000 in January. Education and health care industries added 39,000 jobs; leisure and hospitality industries added 26,000. Retail jobs fell by 1,500.

 

Of 278 industries, 57.6% were hiring in January. Among 84 manufacturing industries, 47.6% were hiring

[NorthSideSox72]

I would like to see a more accurate unemployment measure, over time (not just current). I never thought that the measure was an accurate portrayal, considering the math. People not "actively seeking" employment are out of the pool. I do think it gives you some idea, as a leading indicator, of where the job market is going. But I think the reality of unemployment is not fully captured in that number.

 

So while I think this is good news, I also think you'll see that number go back up as the year goes on, when more people go back into the work force. Then, if the economy can stay strong, it will dip again. JMO.

[Balta1701]

I would like to see a more accurate unemployment measure, over time (not just current).  I never thought that the measure was an accurate portrayal, considering the math.  People not "actively seeking" employment are out of the pool.  I do think it gives you some idea, as a leading indicator, of where the job market is going.  But I think the reality of unemployment is not fully captured in that number.

 

So while I think this is good news, I also think you'll see that number go back up as the year goes on, when more people go back into the work force.  Then, if the economy can stay strong, it will dip again.  JMO.

It's not an accurate measure of the job market by any stretch of the imagination.

 

Yes, the 193,000 jobs added was a decent number. Not stellar, but at least decent. But the reason the unemployment "percentage" ticked down so much last month? You guessed it. Frank Stallone. No, wait a second, that's not right. The reason that the number ticked down 2 points was that another 168,000 people were counted as "Out of the work force" in January.

[jasonxctf]

wonder what will happen to the employment rates when all of the reservists eventually come back from Iraq and Afghanistan looking for work?

[NorthSideSox72]

wonder what will happen to the employment rates when all of the reservists eventually come back from Iraq and Afghanistan looking for work?

 

The reservists and guardsmen will get their jobs back by law (if they had them), in many cases, unless they choose to go elsewhere. But the net effect will cause others to not be hired, so that's going to be a little painful.

[jasonxctf]

The reservists and guardsmen will get their jobs back by law (if they had them), in many cases, unless they choose to go elsewhere.  But the net effect will cause others to not be hired, so that's going to be a little painful.

 

 

with the guaranteed jobs, im guessing that this means that people hired to fill their spots are fired???

[NorthSideSox72]

with the guaranteed jobs, im guessing that this means that people hired to fill their spots are fired???

 

I don't know if there are protections in place for that or not. Most likely, when people leave, companies hire on a temp basis, or not at all, so it wouldn't come to that.

[jasonxctf]

I don't know if there are protections in place for that or not.  Most likely, when people leave, companies hire on a temp basis, or not at all, so it wouldn't come to that.

 

 

i guess it depends on the job. administrative.. sure. managerial, sales, lawyers, accountants etc... no way. full time people are coming in for those positions.

[southsider2k5]

i guess it depends on the job. administrative.. sure. managerial, sales, lawyers, accountants etc... no way. full time people are coming in for those positions.

 

There are actually firms around now that specialize in temp work in the professional fields.

[NorthSideSox72]

There are actually firms around now that specialize in temp work in the professional fields.

 

Lots of them, particularly in accounting and finance.

 

In fact, Manpower is making tons of money lately in those areas. They are also doing killer business in Europe, where contract, temporary and other indirect employment methods are skyrocketing.