A few days late, but here's (a) the chart of 12-month change in jobs by major category, followed by (b) the trends in jobs created and labor force participation rate. Click to enlarge.
I've decided to quit calculating the average wage rates of the jobs lost versus jobs gained. Any one of several algorithms can be chosen to spin the numbers in whichever direction one's chosen political ideology needs it to go—but I'm not into shooting an arrow into the wall, then carefully painting a red bullseye around the spot where it went in. To avoid giving anyone that impression, the simple algorithm I had been using is now dead meat—so please draw whatever conclusions you'd like from the first chart.
My take: The trends don't look as good as most of us would like, but these are not necessarily indicative of a recession yet. I'll defer to Brian Wesbury's explanation, which can be found in the pdf file that will download by clicking this link.
Would it make sense to change the scale of the Labor Force Participation Rate (maybe 60-70% instead of 0 - 100%)? It's hard to notice anything happening even though there was a seemingly significant drop-off.
Posted by: Jason | 13 March 2008 at 00:44
A few comments:
All the talk about recession is starting to bug me. Who cares if GDP growth is minus .05 or plus .05? For cryin' out loud even if we have two quarters of 1% growth that's nothing to write home about.
Westbury mentions productivity. Okay. Whose? China's? India's? Canada's? Given that personal consumption is 70% of GDP and, other than, I'm guessing, durable goods are imports, what is the point? Isn't it time to acknowledge that globalization has
thrown a monkey wrench at legacy metrics?
My angst is more along the inflation genie getting out of the bottle right now. Have you taken a look at commodity prices lately? Either a bubble has to pop or we're going to be in a world of hurt.
Posted by: Bob | 13 March 2008 at 06:04
All we have to do is let the dollar go to zero--default on our debt and then reissue a new currency. Sorry old news, the supply siders have been working on that trick--LOL.
Posted by: gunthestops | 13 March 2008 at 08:30
That's a shame you got rid of that other graph. I totally understand why you did, but I still liked having that other bit of information. Maybe you can think of something less seemingly subjective to post.
Posted by: Mike H. | 13 March 2008 at 16:06
Steve,
Perhaps I'm jumping the gun here, as you may discuss this question in your March jobs update, but I'll ask anyway. In all the recent news reports about the jobs report, they indicate that March will be the third straight month of job losses. They, of course, do not show a source, but I was trying to reconcile their story to your posts about Feb & March which showed modest gains in jobs.
Keep up the great work Steve!
Posted by: JeffFire | 04 April 2008 at 14:31
Jeff:
My numbers are versus 12 months ago, theirs are versus 1 month ago. The most recent single-month number is highly unreliable, because it is usually revised significantly upward or downward within a few months. Comparing it to year-ago is a safer result, although still not foolproof.
Posted by: Optimist123 | 04 April 2008 at 15:41
Thanks Steve. I saw the March report this morning and realized that I had just asked you a stupid question! Sorry about that. Sometimes I look right past the obvious!
Posted by: JeffFire | 07 April 2008 at 08:27