The Bureau of Labor Statistics (BLS) released its October US employment situation report Friday, which was a grab bag for basically anyone: Job growth continued but wasn’t as fast as many analysts hoped. That gave business reporters fodder to analyze from whichever angle they’d like: Negative about the estimate miss, positive about the hiring or just extrapolating current rates of hiring forward. But we found a few of the included numbers a bit more than interesting.
The number of jobs added by US private businesses since private-sector payrolls’ trough in February 2010. Maybe that surprises you positively—maybe it doesn’t, as around 5-6 million are still needed to reach pre-recession levels.
The number, in months, it’s taken for US private businesses to add those 2,765,000 jobs. Is that long? Is it quick? It’s actually in line with the last recovery: 20 is also the number, in months, it took for US private payrolls to equal 2,765,000 hires following 2003’s payroll trough.
The number of months since the current bull market began and recession ended, respectively. Stocks and the economy move first—jobs much later. True historically and true presently.
Zero, +57,000, +104,000
August 2011 nonfarm payroll gains—as initially reported, first revised and then subsequently revised in Friday’s report. The first number was met with a great deal of handwringing. The second two? Far less reported.
Initially reported September nonfarm hiring and Friday’s revised estimate of September nonfarm hiring.
9.1%, 9.1%, 9.1%, 9.0%
The last four months’ US unemployment rates—roughly stable to slightly lower. Yet payrolls keep increasing. This, too, is normal and a function of the unemployment rate’s somewhat quirky construction. Remember: Discouraged workers who ceased looking for work aren’t counted as unemployed. When they become more encouraged and resume their search, they’re added back in. But they could easily become encouraged by seeing friends and relatives get jobs.
The former is October new hires, per the BLS’s household survey. The latter is labor force growth, resulting in October’s slight dip in the unemployment rate.
The number of employed Americans, as of October 2011.
September US retail sales (seasonally adjusted). A record high. Folks fear if unemployment is high, consumers won’t spend. But we can see from past cycles demand can grow and stay quite strong in a recovery, even as unemployment remains elevated. This time is proving no different.
10.8%, 1982 and 1987
1982’s peak unemployment rate was 10.8%, hit in November and December consecutively. It did not reach the US’s long-term average (5.8%) until November 1987—fully five years later.
So what do all these numbers mean? Taken in total, it’s easy to see they don’t indicate a super-robust labor market in the US. But it’s also one that isn’t so far removed from what we’ve experienced in the past. The fact is, it takes a great deal of time to reduce elevated unemployment, which is symptomatic of a past recession. We’d all wish for faster—no one envies the position of those without work. But there’s little historical precedent to suggest private-sector employers will suddenly go on a jobs binge significantly cutting unemployment in the short term. As we’ve said, time and growth are what’s required to reduce unemployment materially.