Jobs According to The DOB (Department Of Bidenomics)

The DOB reported a “blockbuster” jobs number of +336,000 for September this AM, and, not surprisingly, we are distinctly nonplussed. In fact, you actually need a magnifying glass to see what amounts to the grass growing on the jobs front since the turn of the year.

Of course, we are referring to the index of aggregate hours employed in the private sector, which is the only thing which counts.  Government jobs and part-time gigs at the burger joints just don’t cut it when it comes to the nation’s total wage bill and the true growth of economic output. As it happens, therefore, this all-important measure of labor input to the main street economy is up just 0.19% from January. That amounts to less than 0.3% at an annual rate, which is close enough to flat for government work.

Index of Aggregate Labor Hours, January 2023 to September 2023

Moreover, there is nothing especially new about this truly punk trend. In the decades between 1964 and 2000, the index of total labor hours grew by 2.0% per annum, on average. So far this century, by contrast, the labor hours index is up by just 0.73% per year or by only 37% of its historic average.

Of course, the Fed claims to have mightily strengthened the main street economy and labor market with its deft deployment of the printing presses since the turn of the century. Then again, its balance sheet grew by a modest 6% per year between 1964 and 2000, before doubling to more than 12% during the last 23 years. But in the chart below you cannot find a trace of all that extra money pumping—not when the true rate of jobs growth has slowed by more than two-thirds.

Index of Aggregate Labor Hours, 1964 to 2023

If the long-term labor hours data through September 2023 make it clear that money-pumping is no economic elixir, today’s report also throws a bucket of cold water on the Fed’s claim to be adroitly stabilizing the main street economy and taking the kinks out of the business cycle.