Friday, September 02, 2011

Another Mixed U.S. Employment Report

Like many previous employment reports, the August 2011 U.S. employment report contained mixed signals from the household and the payroll surveys. Except that this time, the household survey was actually stronger.

The household survey showed a gain in employment of 331,000, following a cumulative decline of 483,000 in June and July. This illustrates why it is probably less reliable than the payroll survey in terms of monthly fluctuations. It could be noted that the yearly increase is still a lot weaker than in the payroll survey (up 0.25% versus a 0.95% gain in the payroll survey).

The payroll survey by contrast showed no change in employment after several months gain. What made the payroll survey even weaker was a 0.4% drop in average weekly earnings (composed of a 0.1% drop in average hourly earnings and a 0.3% drop in the average work week) that given the flat employment number also implies a 0.4% in aggregate labor earnings. A upward revision in previous numbers however partly offset this weakness.


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