EMPLOYMENT SITUATION
Signs of stronger growth are showing almost everwhere but the employment data. In January payroll employment grew by 36,000 while private payroll job only expanded some 50,000. Employment as reported by the household survey grew 117,000.
This is the third consecutive jobless recovery and the payroll gains have been very weak in all three.
The unemployment rate fell to 9.0%, but that was largely due to a 504.000 contraction in the labor force. I suspect the bad weather is distorting the data and it is hard to place much faith in any of this months data.
The work week contracted and as a consequence the index of aggregate hours worked ticked down. The severe winter weather weather almost certainly impacted the average work week data as many institutions worked fewer hours because of the snow.
For the second month, however average hourly earnings growth improved as the year over year gain in hourly earnings is now 1.9% versus the low of 1.7%. But with the drop in the work week average weekly earnings weakened.
Data unreliable? Maybe. Fer instance, factories were able to pack on more jobs in January than in any month since 1998. Retail added more workers than in any month last year, but every other form of private service, taken together. added only 4k in January, down from 143k in December? Factories in fact managed to account for all but 1k of all private sector hiring in January, and more than all of non-farm employment.
That skew between factory and service hiring may account for some of the rise in hourly earnings, too. If so, it may be revised away.
This is the third consecutive jobless recovery and the payroll gains have been very weak in all three.
Maybe I have a fixation, but it seems that this is a contributor to wealth disparity. Economy recovers, but wages – not so much, while more people fall of the employment rolls. So where do all the recovery profits go? Non productive financial tail-chasing and rent-seeking.
I think Hayak had it exactly backwards, and international corporatism is the road to serfdom.
JzB
Ooh, that first graph is ugly. Let’s hope it is just a month anomaly, and doesn’t continue. The past seven months are not encouraging, and with the spin down of the stimulus created jobs, the Fall does not look good.