Noise in the Labor Market Statistics
As Kash notes the disappointing news about payroll employment growth, you might be wondering why the unemployment rate fell last month. So was I, so let’s check the news from the household survey. First of all, the household survey indicates employment fell by 17 thousand in September but then increased by 214 thousand last month – for a two-month net increase of 197,000. The dip in the recorded employment-to-population from 62.9% in August to 62.8% in September was reversed with the ratio being 62.9% in October. I guess we’ll Jack Snow flipping back to emphasizing the household survey again.
We should also note that the labor force participation rate fell from 66.2% to 66.1%. Now is that a discouraged worker effect or individuals choosing to take more leisure time?