A Primer on Employment Data
This is an introduction to government employment data and the unemployment rate, intended as a reference document. It is policy and forecasting free. Each month I’ll try to replace the second paragraph with quick highlights of the data after they are reported.
The November employment data were a disaster. The headline unemployment rate jumped to 6.7%, from 6.5% the month before and the highest rate since late 1993. Worse still, payrolls plunged 533,000, much more than the 320,000 drop that was expected and the prior two months were revised down from declines of around 240,000 to -403,000 in September and -320,000 in October.
The unemployment rate that hits the headlines is from a survey of households. The respondent is asked if s/he is currently employed, or looking for work. The sum of the two is called the workforce. The unemployment rate is therefore the ratio of those who are looking for work but can’t find a job, divided by the workforce. The official press release is here. The end of the press release includes links to all the detailed data.
The data are usually released the first Friday of the following month (8:30a ET) and are one of the first economic indicators to be published for the month just ended.The employment survey is independent from the weekly data on unemployment insurance claims (reported Thurdays at 8:30a ET), except that details from the unemployment claims are used for annual benchmarking purposes for the employment situation.
A quick look at the press release shows that there are many more statistics included than just the unemployment rate itself. An increasing controversy surrounds people who have dropped out of the workforce because they are discouraged about finding a job. Getting into the weeds, there are other reasons for labor being underutilized, like workers who want to work full-time but who can find only part-time jobs. The Bureau of Labor Statistics (BLS) collects those data too and publishes unemployment rates adjusted for those factors in a supplementary table found here. This data set started to be collected on a monthly basis in 1994, whereas the other data are available monthly since 1948.
The most comprehensive rate for labor underutilization, U-6, is defined as total unemployed, plus all marginally attached workers, plus total employed part-time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers. It jumped to 12.5% in November, up from 8.4% the year before. That compares to the headline unemployment rate at 6.7%, up from 4.7% the year before. BLS publishes another set of data at the same time, from a survey of employers. It is called the nonfarm payroll survey. These are the data that are cited for changes in employment. They are less volatile on a monthly basis than the household survey, and have a wealth of industry detail. Here’s the first of many tables on the payroll survey.
The HH survey details are in the A tables and the payroll survey details in the B tables. Historical data for the A tables here and for the B tables here. (Those links are the last two lines of the press release.
Here is a bit of analysis of the major employment indicators by presidential term.
*High for post-WWII period; e estimated Dec 08 & Jan 09Go here, click the box for unemployment rate seasonally adjusted, click retrieve data, set the date from 1948 on and click the graph box to see a chart.
|Start date of data||11.8%||1/94|
Go here, check the box for U-6 seasonally adjusted, click retrieve data, set the date from 1994 on and click the graph box to see a chart.
|Jobs Added||% change||% change, annual rate|
e estimated for Dec 08 and Jan 09Average Ds 3.5% per yearAverage Rs 1.2% per year