From yesterday’s White House press conference:
CHAIRMAN LAZEAR: … The jobs report contains a variety of information in it, and one of the pieces of information, and only one of the pieces is the jobs number. In addition to that, there are also numbers on unemployment, wage growth and weekly hours. And it’s important to recognize that those numbers were actually good numbers; the unemployment rate actually went down; the wages continued to grow; and weekly hours stayed stable. All of those things are strong indicators that the economy is continuing to move.
It’s in this context I’d like highlight three pictures.
Figure 1: Nonfarm payroll employment (’000s), January release (red) and February release (blue). Source: BLS via St. Louis Fed FRED II.
Payroll employment growth was negative. But on top of that, the previous month’s figures were revised downward
from a positive to a negative growth rate as well. What news for skeptics of the nonfarm payroll series?
Figure 2: Civilian employment (’000s) adjusted to conform to the payroll concept. Source: BLS [pdf].
The “adjusted” household series, which attempts to conform to the payroll employment concept, provides little succor , SF Fed Letter. It’s on the decline as well, although the trend is only readily apparent in the three month moving average.
Figure 3: Annualized three month growth rates in nonfarm payroll employment (blue) and in civilian employment adjusted to conform to nonfarm payroll concept, all calculated as three month differences in log levels. Source: BLS via St. Louis Fed FRED II, BLS, NBER recession dates, and author’s calculations.
Finally, the last month of data is the first time the three month change has gone negative since 2003. Typically, the three month growth rate only goes negative around recessions (since 1967, the only other instance is a 2 month episode a couple months after the 1990-91 recession).