Monday, December 07, 2020

Employment: November Diffusion Indexes

by Calculated Risk on 12/07/2020 11:31:00 AM

The employment diffusion indexes are useful in indicating how widespread job gains are in a given month.

The BLS diffusion index for total private employment was at 58.7 in November, down from 70.7 in October.

For manufacturing, the diffusion index was at 58.6, down from 60.5 in October.

Think of this as a measure of how widespread job gains or losses are across industries. The further from 50 (above or below), the more widespread the job losses or gains reported by the BLS.  From the BLS:
Figures are the percent of industries with employment increasing plus one-half of the industries with unchanged employment, where 50 percent indicates an equal balance between industries with increasing and decreasing employment.
Employment Diffusion IndexClick on graph for larger image.

Both indexes declined sharply in March 2020, and collapsed to new record lows in April, due to the impact from COVID-19.

Then the indexes increased as the economy bounced back.

Both indexes declined in October, but are still at decent levels, indicating job growth was fairly widespread across industries.