Click image
for larger view
According
to the Bureau of Labor
Statistics’ (BLS )
establishment survey, non-farm payroll employment jumped by 271,000 jobs in October
-- “blowing out” consensus expectations
of 190,000 and even the upper end of the range of predictions (240,000). Moreover,
combined August and September employment gains were nudged up by 12,000 (July: +17,000;
August: -5,000). Meanwhile, the unemployment rate (based upon the BLS ’s household survey) edged
down to 5.0% (the lowest since April 2008) as the 320,000 people who found work more than offset the 97,000-person expansion of the labor force.
Click image
for larger view
Observations
from the employment report include:
* The
disparity in job gains between the establishment (+271,000) and household (+320,000)
surveys was less noticeable; the changes were at least directionally consistent.
* Workers
aged 55 and over accounted for 84% of “gross” jobs gained. By contrast, workers
aged 25 to 54 actually declined by 35,000, with males in this age group
tumbling by 119,000; note that age-cohort-based estimates are not additive, as
each cohort is assigned a different seasonal adjustment.
* Manufacturing
employment was unchanged in October. Year-to-date, manufacturing has gained a
net 16,000 jobs; during August and September, however, manufacturing
surrendered 28,000 of the 44,000 jobs gained earlier in 2015. Wood Products
added 1,100 jobs in October; Paper and Paper Products was unchanged.
* Construction
added 31,000 jobs, bringing YTD gains to 118,000. Oil and gas extraction lost
2,700 jobs.
* Over
82% (219,800) of October’s private-sector job growth occurred in the sectors
typically associated with the lowest-paid jobs -- Retail Trade: +43,800; Professional
& Business Services: +78,000; Education & Health Services: +57,000; and
Leisure & Hospitality: +41,000. This is a persistent issue, as we have
repeatedly highlighted: There are 1.429 million fewer manufacturing jobs today
than at the start of the Great Recession in December 2007, but 1.531 million more
Food Services & Drinking Places (i.e., wait staff and bartender) jobs.
Click image
for larger view
* The
employment-population ratio inched up to 59.3%; roughly speaking, for every
five people added to the population, fewer than three are employed. One oddity
in the employment report that analyst Karl Denninger
highlighted is that October’s population-adjusted employment gain appears to
uncharacteristically large; if his observation is correct, future revisions
likely will be negative. Meanwhile, the number of employment-age persons not
in the labor force retreated by 97,000 to just over 94.5 million.
Click image
for larger view
* The
labor force participation rate (LFPR) was unchanged at 62.4%, comparable to
October 1977. Average hourly earnings of all private employees jumped by $0.09
(to $25.20), resulting in a 2.5% year-over-year increase. For all production
and nonsupervisory employees (pictured above), hourly wages also rose by $0.09,
to $21.18 (+2.2% YoY). With the CPI running at an official rate of 0.0% YoY,
wages are technically rising in real (inflation-adjusted) terms. The average
workweek for all employees on private nonfarm payrolls was unchanged at 34.5
hours.
Click image
for larger view
* Finally, full-time jobs increased by 185,000 while part-time
jobs rose by 214,000. Full-time jobs have been trending higher since December
2009, and are now 149,000 above the pre-recession high (even while the
non-institutional, working-age civilian population has risen by an estimated 18.4
million). Part-time jobs, by contrast, have been stuck in a channel between
roughly 27 and 28 million.
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.
