Friday, September 3, 2010


The August employment situation report from the BLS suggests an economy stuck in neutral - nonfarm payroll employment, calculated from a survey of businesses, fell by 54,000. If one removes the loss of 114,000 temporary census jobs, its a gain of 60,000, which is far short of the pace needed to make a dent in mass unemployment of nearly 15 million.

The unemployment rate, which is calculated from a survey of households, ticked up from 9.5% to 9.6%. While the number of people employed increased by 290,000, so did the number of unemployed, by 261,000, as 550,000 people entered the labor force, which is a modestly encouraging sign (the labor force participation rate rose slightly to 64.7%).
Note that those are all seasonally adjusted figures which correct for the drop in labor force participation which normally occurs in August - on an unadjusted basis, the numbers of people employed and unemployed both declined, with the unemployment rate falling from 9.7% to 9.5%. That is, the gain in (seasonally adjusted) labor force participation can be thought of as a gain relative to what normally happens this time of year.

For more, see David Leonhardt, Calculated Risk, Free Exchange, and Real Time Economics' round-up.

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