The January Jobs “Wow” Which Wasn’t, Part 1
When it comes to the growth of good jobs, as opposed to the BLS’ flaky headline counts, there is nothing “wow, wow, wow” about Friday’s jobs report. Yet after three days to digest the report’s dubious internals, today’s Wall Street Journal exuded superlatives,
The U.S. labor market remains incredibly strong…. The U.S. economy added a whopping 517,000 jobs in January, while the unemployment rate fell to its lowest level since 1969, according to Labor Department data.
Actually, the January report showed a -2.502 million jobs decline from the December level. Sure, there is always a seasonal decline in January owing to the shedding of Christmas season help, but that’s just the trouble. There has been so much turbulence in the labor market in the three years since Covid that the seasonal adjustment (SA) factors may be even more dubious than normal.
For instance, the January 2019 report added 2.042 million jobs to the unadjusted count compared to the 2.229 million jobs added this year. As to why the BLS increased the SA factor by nearly 10% when the seasonally unadjusted job count increased by only 2%, only the good folks at the BLS would know.
We simply note that at the January 2019 SA factor, the January 2023 headline gain would have been a not quite so “wow” 334,000 rather than the 517,000 reported by the financial press.
More importantly, contrary to the permabulls and Biden minions, what the internals of Friday’s report actually show is that the labor market story when it comes to full-time jobs and the core goods producing economy remains absolutely nothing to write home about.
To wit, since last March the BLS models have generated +3.6 million new jobs, but the actual household survey has found that the number of full-time, breadwinner employees in January was actually 10,000 lower than had been the case 10 months earlier!
That’s right. The January total for full-time employment was 132.577 million, which was virtually identical to the March 2022 figure, as represented by the indexed purple line below. By contrast, the headline jobs count (blue line) according to the establishment survey rose from 151.424 million to 155.073 million during the same period.
According to the math, therefore, there are well more than 20 million part-time jobs in the US economy, many of them held by multiple job-holders. That is to say, in the face of soaring inflation households are scrambling to make ends meet by scooping up an increasing number of low-pay, part-time gigs as they become available.
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