The
Bureau of Labor Statistics’ (
Meanwhile, the unemployment rate (based upon the BLS’s household survey) ticked up 0.2 percentage point, to 3.9%, as the labor force expanded (+150,000) but the number of employed fell (-184,000).
Observations from the employment reports include:
* The two surveys once again diverged, which erodes
their credibility. While the establishment report showed the addition of 275,000
jobs, the household report indicated the number of employed fell by 184,000.
*
Goods-producing industries gained 19,000 jobs; service providers: +256,000. Job
gains occurred in health care (+67,000), government (+52,000), food services
and drinking places (+42,000), social assistance (+24,000), and in
transportation and warehousing (+20,000). Employment declined in the temporary
help services (-15,400). Total nonfarm employment (157.8 million) is now nearly
5.5 million jobs above its pre-pandemic level in February 2020 (private sector:
+5.19 million; public sector: +313,000). Nonetheless, employment is perhaps 4.7
million below its potential if accounting for growth in the working-age
population since January 2006.
Manufacturing lost 4,000 jobs (led by nondurable goods: -6,000 -- especially chemical manufacturing: -2,100). That result seems to be consistent with the change in the Institute for Supply Management (ISM) manufacturing employment subindex, which fell further into contraction (to 45.9) in February. Wood products manufacturing added 1,600 jobs (ISM fell); paper manufacturing: -900 (ISM decreased); construction: +23,000 (ISM increased).
* The number of employment-age persons not in the labor force edged up (+20,000) to 100.3 million (nearly 5.1 million above February 2020). Because the working-age civilian population expanded (+171,000) while the number of employed fell (-184,000), the employment-population ratio (EPR) ticked down fractionally to 60.1%, which is 1.0PP below its February 2020 level.
* Also, because the working-age civilian population rose by 171,000 while the labor force expanded by 150,000, the labor force participation rate was unchanged at 62.5%. Average hourly earnings of all private employees nudged up by $0.05 (to $34.57), and the year-over-year increase accelerated to +4.2%. Because the average workweek for all employees on private nonfarm payrolls lengthened to 34.3 hours, average weekly earnings rose (+$5.17) to $1,185.75 (+3.6% YoY). With the consumer price index running at an annual rate of +3.1% in January, the average worker appears to have gained purchasing power.
* Full-time workers receded (-187,000) to 132.9 million; there are now over 2.1 million more full-time jobs than in February 2020. For perspective, however, the non-institutional working-age civilian population has expanded by 8.1 million during that period. Workers employed part time for economic reasons (shown in the graph above) -- e.g., slack work or business conditions, or could find only part-time work -- slipped by 46,000, while those working part time for non-economic reasons climbed (+153,000). Multiple-job holders: -13,000; there are now 238,000 more multi-job holders than in February 2020.
For a “sanity test” of the job numbers, we consult
employment withholding/FICA taxes published by the U.S. Treasury.
Although “noisy” and highly seasonal, the data show the amount withheld in February
retreated by $14.4 billion, to $278.7 billion (-4.9% MoM; +8.2% YoY). To reduce
some of the monthly volatility and determine broader trends, we average the
most recent three months of data and estimate a percentage change from the same
months in the previous year; the average of the three months ending February was
down 2.6% from the year-earlier average.
The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.
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