by Bill McBride on 1/04/2013 11:52:00 AM
Friday, January 04, 2013
Here is a table of the change in payroll employment on an annual basis (before benchmark revisions - the revision through March 2012 will be released next month and will show more jobs added based on the preliminary estimate):
|Annual Change Payroll Employment (000s)
Employment growth in 2012 was mostly in line with expectations. A little good news - it appears we are near the end of the state and local government layoffs (see last graph), but the Federal government layoffs are ongoing. Look at the table - four consecutive years of public sector job losses is unprecedented since the Depression.
The first graph below shows the employment-population ratio for the 25 to 54 age group. This has been moving sideways lately, and that shows the labor market is still weak. Also seasonal retail hiring slowed sharply in December (3rd graph) - but overall seasonal hiring suggests a decent holiday retail season.
Hopefully employment growth will pick up some in 2013, although austerity probably means another year of sluggish growth. Here are a several more graphs...
Employment-Population Ratio, 25 to 54 years old
Click on graph for larger image.
Since the participation rate has declined recently due to cyclical (recession) and demographic (aging population) reasons, an important graph is the employment-population ratio for the key working age group: 25 to 54 years old.
In the earlier period the employment-population ratio for this group was trending up as women joined the labor force. The ratio has been mostly moving sideways since the early '90s, with ups and downs related to the business cycle.
This ratio should probably move close to 80% as the economy recovers. The ratio increased in December to 75.9% from 75.7% in November. This has generally been trending up - although the improvement stalled in 2012 - and the ratio is still very low.
Percent Job Losses During Recessions
This graph shows the job losses from the start of the employment recession, in percentage terms - this time aligned at maximum job losses.
In the earlier post, the graph showed the job losses aligned at the start of the employment recession.
This financial crisis recession was much deeper than other post WWII recessions, and the recovery has been slower (the recovery from the 2001 recession was slow too). However, if we compare to other financial crisis recoveries, this recovery has actually been better than most.
Seasonal Retail Hiring
According to the BLS employment report, retailers hired seasonal workers at a slow pace in December.
Typically retail companies start hiring for the holiday season in October, and really increase hiring in November. Here is a graph that shows the historical net retail jobs added for October, November and December by year.
This really shows the collapse in retail hiring in 2008. Since then seasonal hiring has increased back close to more normal levels. Note: I expect the long term trend will be down with more and more internet holiday shopping.
Retailers hired 88.3 thousand workers (NSA) net in December. The combined level for October, November is the highest since 2006. Note: this is NSA (Not Seasonally Adjusted).
This suggests retailers were initially optimistic about the holiday season, but sales might have slowed in December. There is a decent correlation between retail hiring and retail sales, see: Retail: Seasonal Hiring vs. Retail Sales, and the retail season was probably decent.
Part Time for Economic Reasons
From the BLS report:
The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers), at 7.9 million, changed little in December. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.The number of part time workers declined in December to 7.92 million from 8.14 million in November.
These workers are included in the alternate measure of labor underutilization (U-6) that was unchanged at 14.4% in December.
Unemployed over 26 Weeks
This graph shows the number of workers unemployed for 27 weeks or more.
According to the BLS, there are 4.77 million workers who have been unemployed for more than 26 weeks and still want a job. This was down slightly from 4.78 million in November, and is at the lowest level since June 2009. This is generally trending down, but is still very high. Long term unemployment remains one of the key labor problems in the US.
State and Local Government
This graph shows total state and government payroll employment since January 2007. State and local governments lost 129,000 jobs in 2009, 262,000 in 2010, and 230,000 in 2011. In 2012, state and local government employment declined by 26,000 jobs.
Note: The dashed line shows an estimate including the benchmark revision.
It appears most of the state and local government layoffs are over, however the Federal government layoffs are ongoing. Overall government employment has seen an unprecedented decline over the last 3+ years (not seen since the Depression).
Posted by Bill McBride on 1/04/2013 11:52:00 AM