The latest data from the Bureau of Labor Statistics (BLS) reveals an interesting trend in the job market. While nonfarm payrolls have increased by 5.77 million since May of 2022, full-time employment has only seen a modest increase of 457 thousand. This discrepancy between job gains and full-time employment is quite significant and cannot be hidden by any amount of BLS smoothing.
From September 2020 through early 2022, nonfarm payroll job gains and full-time employment changes were closely aligned. However, starting around March of 2022, a noticeable divergence between employment and jobs became apparent. This trend has continued, with the gap between payrolls and full-time employment widening over time.
In January, the job report details revealed some interesting insights. The nonfarm payroll increased by 353,000 to 157,700,000, according to the Establishment Survey. The civilian labor force saw a decrease of 175,000 to 167,276,000, while the participation rate increased by 0.3 to 62.5%. Employment decreased by 31,000 to 161,183,000, and the unemployment rate remained steady at 3.7%.
The data also showed that involuntary part-time work increased by 211,000 to 4,422,000, while voluntary part-time work increased by 302,000 to 22,156,000. Total full-time work decreased by 63,000 to 133,133,000, and total part-time work increased by 96,000 to 27,890,000.
Average weekly hours of all private employees fell slightly, with a decrease of 0.2 hours to 34.1 hours. Average hourly earnings of all nonfarm workers rose by $0.19 to $34.55, marking a year-over-year gain of 4.48%. Similarly, average hourly earnings of production and nonsupervisory workers increased by $0.13 to $29.66, with a year-over-year gain of 4.77%.
The unemployment rate hit a 50-year low in January and April of 3.4%, but has since increased to 3.7%. Alternative measures of unemployment, such as the U-6 rate, provide a more accurate representation of the true unemployment situation, which is higher than the official rate due to various factors like discouraged workers and those who have dropped out of the labor force.
The discrepancy between payrolls and full-time employment raises questions about the accuracy of the data and the methods used to collect it. The reliance on government jobs to mask weaknesses in the job market is also a cause for concern. Additionally, the annual revisions to the data highlight the need for a more comprehensive and accurate assessment of the job market.
In conclusion, the latest job report reveals a significant gap between nonfarm payrolls and full-time employment, indicating a potential discrepancy in the data. It is essential to consider all factors and revisions when analyzing the job market to gain a more accurate understanding of the current employment situation.
