Friday, February 05, 2010

January 2010 employment data

The official unemployment rate declined in January. It's still too early to tell for sure, but so far it looks like we're seeing the declining unemployment that occurs after a typical recession, rather than the "jobless recovery" of the previous two recessions. (The typical pattern after a recession is for the unemployment rate to decline. That pattern was broken by the previous two recessions when the unemployment rate rose for quite a while after the recession had ended.)


Payroll numbers suggest we lost 20,000 jobs in January. That's far better than the pace a year ago, but we need 100,000-200,000 job gains just to keep up with population growth. This graph shows the month-over-month change in payrolls as measured by the U.S. Bureau of Labor Statistics:


Here is the month-over-month change in payrolls as measured by Automatic Data Processing, a private payroll-processing company. I'm starting to favor the ADP data over the BLS data due to lower month-to-month volatility. As a reminder for conspiracy theorists, the ADP data does not come from the government.


Some economists consider aggregate weekly hours worked as the best measure of both unemployment and underemployment. For those of you who favor the U6 measure of the unemployment rate over the official rate because it takes underemployment into account, you should love the Aggregate Weekly Hours Index. Here we see that the pace of average weekly hours worked is showing continuing improvement, but it's still below zero:


Finally, some economists like to look at weekly initial unemployment claims because it is updated more frequently than the monthly statistics above. This graph shows the year-over-year percentage change. Notice it's currently below zero, which is a good sign.


For those of you on the east coast, enjoy the snow this weekend.

10 comments:

  1. The "New Normal" will become painfully evident when these curves go through an excruciating period of flatness. I expect everything to plateau throughout 2010 unless something drastic happens in Wash.

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  2. HA! Massachusetts gets to miss the storm for once!

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  3. The numbers were - if not revised again later - most certainly an improvement. Hours worked up, pay is up and initial jobless is down. Let's hope it continues.

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  4. Define hoping on crap government money? Lets just allow our whole lives to be dependant on Russia, I mean government handouts.

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  5. "Hours worked up, pay is up and initial jobless is down."

    Strange, cause all the headlines on the topic from google news say "jobless is down, but pay is way way down too!"

    Where did you read pay is up?

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  6. "Where did you read pay is up?"

    probably nowhere. Its easy to just make crap up and post a comment on a blog.

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  7. "...we need 100,000-200,000 job gains just to keep up with population growth..."

    This is why population growth needs to be zero population growth...

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  8. "This is why population growth needs to be zero population growth..."

    Yeah cause a nation of nothing but aging baby boomers retiring will really kickstart the economy!!!

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  9. Well, zero population growth would mean people stopping at 2 children per couple, not 6, or 19, like is encouraged now...

    There would still be babies, anon 9:09...just not so damn many of them.

    And maybe not so many whose parents can't afford to raise them so we all get stuck with the bill for their school lunches, school breakfasts, ESL classes, etc.

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  10. Having babies is in major decline in developed industrialized nations. Population growth isn't due to having too many babies, its due to massive immigration from 3rd world and developing nations.

    Countries like Spain and France are worried they are going to lose their culture due to nation born citizens not having children and the huge influx of middle eastern Muslim immigrants. Which is the reason they offer all kinds of incentives for nation born people to have children.

    In the end, someone is going to have to take care of all those old white aging babyboomers, wiping their ass and taking their money....and it wont be the babyboomers grandchildren cause they wont have any. It will be someone who immigrated from a poorer nation.

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