Note also that on a Y-o-Y basis (the only way BLS reports it) 24% of all newly created US jobs went to persons born abroad, this concerns me and should concern everyone, but it is down from the whopping big numbers (~66%) we were seeing this summer.
I think a neutral view is “Yes, 24% is also unacceptable. . . . if it were a steady, but it is not steady it is 24% on the way down from a ridiculously high number. If the trend continues only the right-wing types will object.”
Looks like a slowing economy. Which is fine as we need the fed to stop raising interest rates.
"In addition to the October slowdown, the Bureau of Labor Statistics revised lower its counts for the previous two months: September’s new total is 297,000, ( revised down )from the initial 336,000, while August came in at 165,000 ( revised down ) from 227,000. Combined, the revisions took the original estimates down by 101,000.
Job creation skewed heavily to full-time workers, reversing a recent trend. Full-time jobs grew by 326,000, while part-time tumbled by 670,000 as summertime seasonal jobs wrapped up."
A couple of recent jobs reports showed unusually high growth in the number of people with multiple jobs.
One m/l neutral narrative that makes sense:
A few years ago folks who already own a home (60% of US households) refinanced at 2.5% getting, in effect a $12k annual raise.
Since then, they have been spending like crazy. That increase in demand is what is driving the economy and driving inflation.
That means the other 40% are stuck. They don’t own a home. They didn’t get raises. They didn’t enjoy any new spending, but they are paying for inflation and paying for higher interest rates
----> It’s a k-shaped mess, but it means the Fed is at fault, Trump Biden and Congress have at least one clean hand in the matter.
“The Fed finally got what it’s been looking for — a meaningful slowdown in the labor market,” said Mike Loewengart, head of model portfolio construction for Morgan Stanley’s Global Investment Office.
“We’ve seen one or two head fakes in this direction before, but the fact that this report followed other weaker-than-expected economic data points this week may encourage investors who have been waiting for a less-hawkish Fed,” he added.
Normally there is a limited amount of “cash on the sidelines” floating around in money market accounts etc., and a bad(ish) and so money flows either
from stocks into bonds, (when bad news is announced) or
from bonds into stocks, (when good news is announced.
Right now there is still a lot sideline cash and so a third flow, one we usually don’t even consider, is happening. This time cash flowed from the sidelines into both, sending both markets higher.
Caveat emptor:
There is a lot of chatter about the size of this week’s upcoming bond auction.
Several bond auctions have gone “no-bid” recently (buyers were not willing to buy all the bonds at the low rate the Fed was asking.)
Any bond auction of any size either
draws money from the stock market, or
draws cash from the sideline, or
the Fed prints the difference. Some combination of those three must happen, and will happen in larger-than-usual amounts this coming week.
The Biden administration has revised down previously reported jobs data for nearly every month this year, resulting in a huge disparity from the originally advertised numbers, according to the Bureau of Labor Statistics (BLS).
The number of jobs added in August was revised down from 227,000 to 165,000, and September was revised down from 336,000 to 297,000, resulting in 101,000 fewer jobs than were previously reported, according to the BLS. The U.S. economy added 150,000 jobs in October, subject to revisions in future reports, lower than the 170,000 jobs that economists expected.
“While the huge downward revisions this year are not unprecedented, this pattern has only ever occurred right before or during a recession,” E.J. Antoni, a research fellow at the Heritage Foundation’s Grover M. Hermann Center for the Federal Budget, told the Daily Caller News Foundation. “This could partly be due to the statistical patterns that we see as the economy contracts and firms go out of business, laying off workers at a rapid pace. At the same time, new businesses that are started hire fewer workers than at other points in the business cycle. This can produce job estimates that are heavily biased to the upside.”
19 of the last 25 monthly jobs reports have been revised downward (75%)
The number includes all seven of the last seven.
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Probably related:
The Monthly BLS jobs report consists of two surveys, both reliable, each used for different purposes, one of employers, one of households/employees.
There is normally some small divergence between the two, but post pandemic that divergence has been growing unusually large, large enough that econ nerds are talking seriously about revising the methodology. The most likely explanations are
post-pandemic an unusually large number of households “suddenly” have new never-before-used phone numbers (illegal immigrants)
and/or
post-pandemic and unusually large number of people are working second jobs including gig work such as part-time Uber driver
West coast manufacturers are either relocating to the Midwest or south, if not there they are moving to Mexico or China. Joe saving US manufacturing is the biggest lie of all time, all the inflation reduction act does is give more money to Fortune 500 companies who pocket it.
