2010 Economic Calendar
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Employment Situation  
Released On 9/3/2010 8:30:00 AM For Aug, 2010
PriorPrior RevisedConsensusConsensus RangeActual
Nonfarm Payrolls - M/M change-131,000 -54,000 -90,000 -160,000  to 75,000 -54,000 
Unemployment Rate - Level9.5 %9.6 %9.5 % to 9.7 %9.6 %
Private Payrolls - M/M change71,000 107,000 40,000 -5,000  to 110,000 67,000 
Average Hourly Earnings - M/M change0.2 %0.1 %0.1 % to 0.2 %0.3 %
Av Workweek - All Employees34.2 hrs34.2 hrs34.1 hrs to 34.3 hrs34.2 hrs
Nonfarm Payroll - level131,000 millions

Overall payroll employment fell for the third straight month but there was a moderate gain in the private sector. Also on the positive side, wages were up. Overall payroll jobs in August slipped 54,000 after falling a revised 54,000 in July (yes, they are the same) and contracting 175,000 in June. The August overall number was less negative than the consensus forecast for a 90,000 decrease. The June and July revisions were net up 123,000.

A big part of the latest month's weakness was seen in the government sector, which still includes layoffs of temporary Census workers. Government jobs dropped 121,000 after falling 161,000 in July. In contrast, private nonfarm employment continued to rise, gaining 67,000 in August, following a revised boost of 107,000 the month before. Analysts had called for a 40,000 advance for private payrolls in August. July had previously been estimated to be a 71,000 increase.

Looking at private sector components, private service providing jobs rose 67,000 after a 70,000 boost in July. Leading the way was a 45,000 boost in education & health services, with health care up 40,000. Professional & business services returned to positive territory, rising 20,000 after dipping 3,000 in July. For the latest month temp help was up 17,000. Some weakness was seen in retail trade, down 5,000 in August.

Goods-producing jobs were unchanged in August after a 37,000 advance in July. In the goods-producing sector, manufacturing fell 27,000 with 22,000 of this accounted for in motor vehicles. This may be partly related to atypical seasonals in retooling timing this year. Construction jobs actually rebounded 19,000 after dipping 4,000 in July. Mining rose 8,000.

Average hourly earnings improved to 0.3 percent from up 0.2 percent in July. The August number topped the market estimate for a 0.1 percent gain. The average workweek for all workers was unchanged at 34.2 hours in July. The market forecast was for 34.2 hours.

Looking ahead to the personal income report, aggregate weekly earnings were favorable toward a moderately healthy wages & salaries component. Aggregate weekly earnings rose 0.3 percent in August, following a 0.6 percent gain the month before.

On a year-ago basis, overall payroll jobs nudged up to 0.2 percent in August from up 0.1 percent in July.

Turning to the household survey, the unemployment rate came in at 9.6 percent, compared to 9.5 percent in July. The consensus projected a 9.6 percent figure for August.

Overall, today's report shows that the economy is not going back to recession. Still, growth is less than robust. For now, it appears to be a growth recession (less than long-term trend), but not an outright recession. The bottom line is that the private sector is holding up better than expected.

Consensus Outlook
Nonfarm payroll employment in July declined 131,000 after falling a revised 221,000 in June and after a 432,000 boost in May. Of the July government plunge, 143,000 came from a drop in Census Bureau payrolls. State government fell 10,000 while local government dropped 38,000. Private nonfarm employment, which discounts the effects of hiring and firing temporary Census workers, accelerated moderately to a 71,000 increase, following a 31,000 gain in June. Average hourly earnings improved to up 0.2 percent, following no change in June. The average workweek for all workers rose to 34.2 hours from 34.1 hours in June. Turning to the household survey, the unemployment rate was unchanged at 9.5 percent in July. More recently, despite a dip this past week, initial jobless claims in August have been running higher than during July and this implies sluggish payroll and unemployment numbers. Employment indexes for the Philly and New York Fed manufacturing surveys were mixed as Empire rose while Philly slipped from positive to negative. Analysts will be tweaking their expectations with the ISM manufacturing and ADP reports just ahead of Friday's employment situation. Added Note: consensus numbers are revised as of Thursday afternoon.

The most closely watched of all economic indicators, the employment situation is a set of monthly labor market indicators based on two separate reports: the establishment survey which tracks 650,000 worksites and offers the nonfarm payroll and average hourly earnings headlines and the household survey which interviews 60,000 households and generates the unemployment rate.

Nonfarm payrolls track the number of part-time and full-time employees in both business and government. Average hourly earnings track employee pay while the average workweek, also part of the establishment survey, tracks the number of hours worked. The report's private payroll measure excludes government workers.

The unemployment rate measures the number of unemployed as a percentage of the labor force. In order to be counted as unemployed, one must be actively looking for work. Other commonly known data from the household survey include the labor supply and discouraged workers.  Why Investors Care
During the mature phase of an economic expansion, monthly payrolls gains of 150,000 or so are considered relatively healthy. In the early stages of recovery though, gains are expected to surpass 250,000 per month.
Data Source: Haver Analytics
The civilian unemployment rate is a lagging indicator of economic activity. During a recession, many people leave the labor force entirely, so the jobless rate may not increase as much as expected. This means that the jobless rate may continue to increase in the early stages of recovery because more people are returning to the labor force as they believe they will be able to find work. The civilian unemployment rate tends towards greater stability than payroll employment on a monthly basis. It reveals the degree to which labor resources are utilized in the economy.
Data Source: Haver Analytics

2010 Release Schedule
Released On: 1/82/53/54/25/76/47/28/69/310/811/512/3
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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