2011 Economic Calendar
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Employment Situation
Released On 9/2/2011 8:30:00 AM For Aug, 2011
PriorPrior RevisedConsensusConsensus RangeActual
Nonfarm Payrolls - M/M change117,000 85,000 60,000 -5,000  to 150,000 
Unemployment Rate - Level9.1 %9.1 %9.0 % to 9.2 %9.1 %
Private Payrolls - M/M change154,000 156,000 75,000 5,000  to 180,000 17,000 
Average Hourly Earnings - M/M change0.4 %0.5 %0.2 %0.0 % to 0.3 %-0.1 %
Av Workweek - All Employees34.3 hrs34.3 hrs34.3 hrs to 34.4 hrs34.2 hrs

Highlights
Apparently, the recent federal debt ceiling debate fiasco and stock market decline spooked businesses to put a hold on hiring. Payroll jobs were unchanged in August, following a revised 85,000 increase in July, and revised 20,000 in June. The market consensus (updated Thursday afternoon) called for a 60,000 increase for the latest month. Revisions for June and July were down net 58,000. As in recent months, private sector employment was a little less weak since government jobs pulled down the total. Private nonfarm payrolls edged up 17,000 in August, following a 156,000 gain in July and 75,000 increase in June. The August figure came in sharply lower than the median estimate for a 75,000 increase.

In the private sector, goods-producing jobs edged down while service-providing jobs rose modestly. Goods-producing jobs slipped 3,000, following a 52,000 rise in July. Manufacturing jobs dipped 3,000 after a 36,000 boost the month before. Construction employment declined 5,000 after increasing 7,000. Mining expanded 6,000, following an 8,000 gain in July.

Private service-providing jobs rose 20,000 in August, following a 104,000 increase prior month. The August gain was led by health care (up 29,700) and professional & business services (up 28,000). In the latter category, temp services rose 4,700. Telecommunications led on the downside, falling 47,300 and with about 45,000 due to striking Verizon workers. Looking for any bright spot, adjusted for the Verizon strike, private payrolls rose 62,000 in August-which is still very anemic.

The public sector continued to contract as government employment fell 17,000, following a 71,000 drop in July. The drop was led by a 20,000 decrease at the local level with the federal government down 2,000. The return of about 22,000 Minnesota government workers from a partial government shutdown offset declines elsewhere as state employment rose 5,000.

Earnings growth fell back from the auto-sector induced jump in July. Average hourly earnings slipped 0.1 percent after jumping 0.5 percent in July. The market median estimate was for a 0.2 percent increase. The average workweek for all workers in August edged down to 34.2 hours from 34.3 in July. The consensus had called for 34.3 hours.

From the household survey, the unemployment rate posted at 9.1 percent, equaling the prior month and expectations.

Today's report clearly shows that momentum in the labor market has stalled. The curiosity is that while hiring has come to a standstill, layoffs have not picked up. Still, today's news is not good news for the economy and places more emphasis on the importance of President Barack Obama's upcoming plan for job creation and on whether the Fed will engage in QE3. The odds of another round of quantitative easing just went up.

Recent History Of This Indicator
Note: Consensus numbers were updated after the jobless claims and ISM manufacturing reports on Thursday, September 1.

Nonfarm payroll employment in July advanced 117,000, following a revised 46,000 rise in June, and a revised 53,000 increase in May. Private sector growth was somewhat healthier as private nonfarm payrolls grew 154,000 in July, following an 80,000 rise in June and 99,000 increase in May. In the private sector, improvement was seen in both goods-producing and services-providing sectors. The public sector weighed on overall employment. Wage growth picked up as average hourly earnings increased 0.4 percent, following no change in June. The average workweek for all workers in July was unchanged at 34.3 hours and matched the market consensus. From the household survey, the unemployment rate slipped to 9.1 percent from 9.2 percent in June.

Definition
The employment situation is a set of labor market indicators based on two separate surveys in this one report. The unemployment rate equals the number of unemployed persons divided by the total number of persons in the labor force, which comes from a survey of 60,000 households (this is called the household survey). Workers are only counted once, no matter how many jobs they have, or whether they are only working part-time. In order to be counted as unemployed, one must be actively looking for work. Other commonly known figures from the Household Survey include the labor supply and discouraged workers.  Why Investors Care
 
[Chart]
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
 
[Chart]
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
 

 

2011 Release Schedule
Released On: 1/72/43/44/15/66/37/88/59/210/711/412/2
Release For: DecJanFebMarAprMayJunJulAugSepOctNov
 


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