The surge in employment fueled by part-time jobs and the Obamacare effect may finally be over. Although the establishment survey showed a gain of 88,000 jobs, the household survey, off which the unemployment rate is based, showed a loss of 206,000 jobs.
The unemployment rate edged lower by .1% because a whopping 496,000 people dropped out of the labor force.
Last month, voluntary part-time employment rose by a reported 446,000. It's plain to see that last month's numbers were a statistical aberration. This was a miserable jobs report from every angle.
March BLS Jobs Report at a Glance
Payrolls +88,000 - Establishment Survey
US Employment -206,000 - Household Survey
US Unemployment -290,000 - Household Survey
Involuntary Part-Time Work -230,000 - Household Survey;
Voluntary Part-Time Work -163,000 - Household Survey
Nonfarm payroll employment edged up in March (+88,000), and the unemployment rate was little changed at 7.6 percent, the U.S. Bureau of Labor Statistics reported today. Employment grew in professional and business services and in health care but declined in retail trade.
Click on Any Chart in this Report to See a Sharper Image
Unemployment Rate - Seasonally Adjusted
Month to Month Change by Type of Job
Average weekly hours rose .1 to at 34.6 hours. A year ago average hours were 34.5 hours. Average hourly earnings rose $0.01 to $23.83. In 2013, average hourly earnings are up $0.05. Real wages have been declining. Add in increases in state taxes and the average Joe has been hammered pretty badly. For 2013, one needs to factor in the increase in payroll taxes for Social Security.
The BLS Birth/Death Model is an estimation by the BLS as to how many jobs the economy created that were not picked up in the payroll survey.
The Birth-Death numbers are not seasonally adjusted, while the reported headline number is. In the black box the BLS combines the two, coming up with a total.
The Birth Death number influences the overall totals, but the math is not as simple as it appears. Moreover, the effect is nowhere near as big as it might logically appear at first glance.
Do not add or subtract the Birth-Death numbers from the reported headline totals. It does not work that way.
Birth/Death assumptions are supposedly made according to estimates of where the BLS thinks we are in the economic cycle. Theory is one thing. Practice is clearly another as noted by numerous recent revisions.
Birth Death Model Adjustments For 2012
Birth Death Model Adjustments For 2013
Once again: Do NOT subtract the Birth-Death number from the reported headline number. That approach is statistically invalid.
In general, analysts attribute much more to birth-death numbers than they should. Except at economic turns, BLS Birth/Death errors are reasonably small.
People go back to school hoping it will improve their chances of getting a job
People stay in school longer because they cannot find a job
Were it not for people dropping out of the labor force, the unemployment rate would be well over 10%.
Part Time Status (in Thousands)
click on chart for sharper image
There are 7,638,000 workers who are working part-time but want full-time work. A year ago there were 7,664,000. There has been no improvement in a year. This is a volatile series.
Table 15 BLS Alternate Measures of Unemployment
click on chart for sharper image
Table A-15 is where one can find a better approximation of what the unemployment rate really is.
Notice I said "better" approximation not to be confused with "good" approximation.
The official unemployment rate is 7.6%. However, if you start counting all the people who want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6.
U-6 is much higher at 13.8%. Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.
Duration of Unemployment
Long-term unemployment remains in a disaster zone with 39.6% of the unemployed in the 27 weeks or longer category.
Grossly Distorted Statistics
Given the complete distortions of reality with respect to not counting people who allegedly dropped out of the work force, it is easy to misrepresent the headline numbers.
Digging under the surface, much of the drop in the unemployment rate over the past two years is nothing but a statistical mirage. Things are much worse than the reported numbers indicate.
TownhallFinance.com makes available to the viewer a variety of independent sources that offer trading and investment advice and related services and products.
TownhallFinance.com does not itself offer, verify, sponsor, or promote, directly or indirectly, any investment or trading advice, or information or any product or service offered by these independent sources.
Every investor or trader should consider all advice and all offerings of products and services on their own merits and for suitability to the individual's personal needs and circumstances. Before using this site, please read our complete Terms of Service by clicking here.
Make TownhallFinance.com your premier source for stock market and financial market information. Individual investors enjoy our worldwide investor seminars and trading seminars. Our investment advisor seminars keep financial advisors up to data with CEUs, and this site provides investors, traders, and advisors with the latest stock market analysis tips, information and research tools. Be sure to be a part of our options day trading tips and picks from professional day traders and various trading, investing and advisor Webcasts and financial podcasts.