Friday, July 6, 2012

Employment (Excluding Teen Hires) Turns Negative

Peter Boockvar provides details of the ugly job report:

June Payrolls totaled 80,000, 20,000 less than expected and well below the ADP whisper. The two prior months were revised down by a net 1000. The private sector added 84,000 jobs (13,000 from goods producing, 71,000 from services) vs expectations of a gain of 106,000. The unemployment rate held steady at 8.2% as the 128,000 increase in the household survey was basically offset by the 156,000 increase in the size of the labor force.
Below is an updated chart of the stagnant unemployment rate and slightly up ticking broader unemployment measure.

Unfortunately, things were even worse than that. When looking at the household survey, we see that the headline measure of unemployment doesn't account for the fact that teen employment (likely low pay part-time workers on summer break) accounted for more than 100% of all new jobs. Excluding teens (the second bracket from the left in the chart below), we can see that negative employment number. In addition, individuals over 20 continue to flee the workforce (more than 150,000 more 20+ year olds were classified as "not in the labor force").

A truly ugly report on first glance.

Source: BLS


  1. Jake,

    One of the stories I read about this month's BLS report dealt with the rise in people on disability. I thought charting this over a few dozen years and several recessions might tell an interesting story.

    Just an idea.


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