Friday, November 08, 2013

October Employment Report: 204,000 Jobs, 7.3% Unemployment Rate

by Bill McBride on 11/08/2013 08:30:00 AM

From the BLS:

Total nonfarm payroll employment rose by 204,000 in October, and the unemployment rate was little changed at 7.3 percent, the U.S. Bureau of Labor Statistics reported today. ...
Among the unemployed, however, the number who reported being on temporary layoff increased by 448,000. This figure includes furloughed federal employees who were classified as unemployed on temporary layoff under the definitions used in the household survey.
The civilian labor force was down by 720,000 in October. The labor force participation rate fell by 0.4 percentage point to 62.8 percent over the month. Total employment as measured by the household survey fell by 735,000 over the month and the employment-population ratio declined by 0.3 percentage point to 58.3 percent. This employment decline partly reflected a decline in federal government employment.
The change in total nonfarm payroll employment for August was revised from +193,000 to +238,000, and the change for September was revised from +148,000 to +163,000. With these revisions, employment gains in August and September combined were 60,000 higher than previously reported.
The headline number was well above expectations of 120,000 payroll jobs added.

Percent Job Losses During RecessionsClick on graph for larger image.

This graph shows the job losses from the start of the employment recession, in percentage terms, compared to previous post WWII recessions. The dotted line is ex-Census hiring.

This shows the depth of the recent employment recession - worse than any other post-war recession - and the relatively slow recovery due to the lingering effects of the housing bust and financial crisis.

Employment is still about 1% below the pre-recession peak.

Payroll jobs added per month
NOTE: The second graph is ex-Census meaning the impact of the decennial Census temporary hires and layoffs is removed to show the underlying payroll changes.

The third shows the unemployment rate.

The unemployment rate increased in October to 7.3% from 7.2% in September.

unemployment rate This increase in the unemployment rate is probably related to the government shutdown - and should be reversed in the November employment report.

The fourth graph shows the employment population ratio and the participation rate.

The Labor Force Participation Rate was declined sharply in October to 62.8% from 63.2% in September (related to shutdown). This is the percentage of the working age population in the labor force. 

Employment Pop Ratio, participation and unemployment ratesThe participation rate is well below the 66% to 67% rate that was normal over the last 20 years, although a significant portion of the recent decline is due to demographics.

The Employment-Population ratio was declined in October to 58.3% from 58.6% in September (black line).

I'll post the 25 to 54 age group employment-population ratio graph later.

This was a solid employment report - especially with the upward revisions to prior months.  Many of the negatives were related to the government shutdown and should be reversed in the November report.  I'll have much more later ...