Friday, September 05, 2008

Summary Of August U.S. Employment Report

Bearish elements: 84K in payroll losses, despite continued increases in imputed jobs through the fraudulent so-called "Birth/Death Model". Plus downward revisions of previous numbers of 60K. Continued decline in aggregate hours worked, particularly in manufacturing (hinting a significant decline in industrial production). 342K in job losses according to the household survey, causing the unemployment rate to soar from 5.7% to 6.1%. 12 month change in payroll employment now is -413K; 12 month change in household survey employment is -653K.

Bullish elements: None. Or actually, there is one thing that comes close. Namely the 0.4% increase in average hourly earnings, but this likely reflects to a large extent workers demanding compensation for inflation as well as the increase in the minimum wage. Still, with monthly all-items inflation likely decelerating sharply in August due to a decline in energy costs, this means that real average hourly earnings likely rose after several months of negative numbers.


Anonymous Anonymous said...

Hi Stefan,

The 0.4% increase in average hourly income could also represent low-income earners being forced out of the labor market, and thus driving up hourly earnings by default. In that case, it really can't be good news at all.

Thanks, Rebecca

10:33 PM  

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