Friday, August 3, 2012

UK: The truth behind US jobs numbers

The Economist

America's jobless recovery

The big picture

Aug 3rd 2012, 13:56 by R.A. | WASHINGTON

ALL eyes focused on the homepage of the Bureau of Labour Statistics this morning, in anticipation of the latest release of America's most watched piece of economic data: the monthly jobs report. The hope, as always, was for clarity, some obvious sign of the economy's direction. Unsurprisingly, clarity was not on the menu. Instead, the July report held a bit of something for everyone.


Something for everyone. Yet the Rorshach nature of the monthly report actually resolves into a clear picture if one steps back and looks at the medium-run trend. Since payrolls bottomed in February of 2010, employment has risen by an average of 138,000 jobs per month. Over the past year, payrolls have risen at an average pace of 153,000 jobs per month. Over the past quarter, employment has risen at 105,000 jobs per month. And in July payrolls rose at 163,000 jobs per month. To a striking extent, the pace of employment recovery has been stable at a level just above underlying labour-force growth. The unemployment rate has fallen, but mostly as long-term unemployed workers have left the labour force. The employment-population ratio is essentially unchanged from February of 2010; it was 68.5% then, just a tenth of a percentage point above the current level.

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