January jobs report

January jobs report: good headline growth, mostly negative internals. UPDATE: THE BOSSES GAVE THEMSELVES A RAISE

  • +200,000 jobs added
  • U3 unemployment rate unchanged at 4.1%
  • U6 underemployment rate rose 0.1% from 8.1% to 8.2%
Here are the headlines on wages and the chronic heightened underemployment:
Wages and participation rates
  • Not in Labor Force, but Want a Job Now: declined -137,000 from 5.308 million to 5.171 million
  • Part time for economic reasons: rose +74,000 from 4.915 million to 4.989 million
  • Employment/population ratio ages 25-54: fell -0.1% from 79.1% to 79.0%
  • Average Weekly Earnings for Production and Nonsupervisory Personnel: rose +$.0.03 from  $22.31 to $22.34, up +2.4% YoY.  (Note: you may be reading different information about wages elsewhere. They are citing average wages for all private workers. I use wages for nonsupervisory personnel, to come closer to the situation for ordinary workers.)
Holding Trump accountable on manufacturing and mining jobs
 Trump specifically campaigned on bringing back manufacturing and mining jobs.  Is he keeping this promise?  
  • Manufacturing jobs rose by +15,000 for an average of  +17,300 a month vs. the last seven years of Obama’s presidency in which an average of 10,300 manufacturing jobs were added each month.
  • Coal mining jobs increased by 100 for an average of -46 a month vs. the last seven years of Obama’s presidency in which an average of -300 jobs were lost each month

November was revised downward by -36,000. December was revised upward by +12,000, for a net change of -24,000.

The more leading numbers in the report tell us about where the economy is likely to be a few months from now. These were mixed.
  • the average manufacturing workweek fell -0.2 hour from 40.8 hours to 40.6 hours.  This is one of the 10 components of the LEI.
  • construction jobs increased by 36,000. YoY construction jobs are up +226,000.
  • temporary jobs increased by +1,800.
  • the number of people unemployed for 5 weeks or less increased by +45,000 from 2,235,000 to 2,280,000.  The post-recession low was set over two years ago at 2,095,000.
Other important coincident indicators help  us paint a more complete picture of the present:
    • Overtime was unchanged at 3.5 hours.
    • Professional and business employment (generally higher- paying jobs) increased by  +23,000 and  is up +448,000 YoY.
  • the index of aggregate hours worked in the economy rose by +0.2%.
  •  the index of aggregate payrolls rose by +0.4% .
Other news included:
  • the  alternate jobs number contained  in the more volatile household survey increased by  +409,000  jobs.  This represents an increase of 2,354,000 jobs YoY vs. 2,114,000 in the establishment survey.
  • Government jobs rose by 4,000.
  • the overall  employment to population ratio for all ages 16 and up is unchanged at  60. m/m  and is up + 0.2% YoY.
  • The  labor force participation  rate is unchanged at 62.7  m/m and is down -0.2% YoY at  62.7%
This was a very mixed report. The headline jobs number was very good, but most of the internals were flat to negative, including an uptick in the underemployment rate, a decline in the manufacturing workweek, and a decline in prime age labor participation. Short term unemployment also increased slightly.
And of course, wage growth for non-managerial personnel continued to be somnolent.

So while we have a recent increase in employment growth, most of the other measures are either tepid or are fraying a little bit around the edges.

UPDATE: I see where the main item in most other discussions in this report is “the big jump in wages!

Ummm, not so fast.  The “big raise” of 2.9% YoY is for ALL employees, including the bosses. The number for workers who aren’t managers, as I report above, is a tepid 2.4%, right about where it has been for several years. So it workers got 2.4% YoY, but workers plus bosses got 2.9% YoY, then that means the bosses gave themselves big fat raises that have not been shared with the line workers.

I’m not impressed.