AUG: +151,000 jobs. Unemployment rate steady at 4.9%. AUG details here!.. Jobs since Obama took office?... Unemp. rate under Obama?

Saturday, May 7, 2011

How Many Jobs Were Created in April 2011?




So.. just how many more people are actually working this month vs. last month?

These numbers are explained below:  Between 244,000 and 1,169,000 people are working in April who were not working in March.  


1,169,000 more actual  jobs in unadjusted numbers are reported by employers now than in March.

244,000 more jobs in seasonally-adjusted numbers are reported by employers now than in March.


699,000 more people are reporting that they are working this month in "unadjusted" real numbers.


190,000 fewer people are working this month in seasonally-adjusted numbers. 


Clearing up the Confusion about those Unemployment Numbers... Continue below.

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September jobs numbers will be released
Friday, October 7.  Check back then! 
Other articles on unemployment:
How many jobs were created in 2011? 
How the Unemployment Rate is Calculated 
February Unemployment: Good news? 
Alternate Unemployment Rate is 18.6% 
Monthly Unemployment Report for March 2011 
What Percentage of the Unemployed Get Benefits?
 Monthly Unemployment Report for April 
Alternate Unemployment Rate for April is 18.1%
Other articles you may wish to check out:
Crushing the Human Spirit Indeed!

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I've been burying my head in the employment numbers for several years now, since the economy fell off of a cliff.  I'm always stunned at the varying interpretations of the unemployment numbers that we are all subject to every month and every week.  I watched a local news show last night and the news bunnies were all in a tither about how wonderful the new monthly jobs report was.  It was clear they could have cared less and they really didn't know what the job report said... they had jobs!  But what about the rest of us who aren't news bunnies?  Just how thrilled should we be about this jobs report?    



I've written about this before (See How the Unemployment Rate is Calculated), but there are many twists and turns to estimating employment/unemployment in this country.


So let's look at a few of those twists and turns:


Seasonally adjusted vs. non-seasonally adjusted:


There are times of the year when employment always goes down and unemployment always goes up.  Vice verse, there are times of the year when employment always goes up and unemployment always goes down.  Christmas is the easiest of those times to understand.  Employment is always up in December due to Christmas retail hiring.  Unemployment is always down in December.  In January, when all of those retail establishments cut back, employment is always down and unemployment is always up.  There are also ups and downs due to seasonal variations such as outdoor construction work, staffing for summer and vacation venues, and layoffs associated with the end of the school year.


Seasonal adjustments (made by statisticians using these usual variations) are attempts to even out these normal ups and downs so that we can all have a better understanding of what is happening with the employment situation aside from the usual seasonal ups and downs.


The Population Survey vs. the Establishment Survey


The first set of monthly numbers, the numbers from which the unemployment rate is derived, come from the Census Bureau's population survey.  They interview a portion of the households in the population every month about their employment situations.  This is explained in greater detail on the BLS (Bureau of Labor Statistics) website.  This survey represents people telling the Labor Department about whether or not they are working, looking for work, etc.


These numbers are presented in two sets:  One, seasonally unadjusted, the other, seasonally adjusted.


The Establishment survey consists of reports from businesses about how many people they have working for them in various industries.  Wage and hours are also reported.


Again, these numbers are presented in two sets:  One, seasonally unadjusted; the other, seasonally adjusted.


The Population Survey and the Establishment Survey do often match (kinda), if one remembers these things:
  • The household survey includes agricultural workers, the self-employed, unpaid family workers, and private household workers among the employed. These groups are excluded from the establishment survey. 
  • The household survey includes people on unpaid leave among the employed. The establishment survey does not. 
  • The household survey is limited to workers 16 years of age and older. The establishment survey is not limited by age.   (So this number will really be screwed up when (actually if) Maine and a few other regressive states vote to loosen child labor laws.)  
  • The household survey has no duplication of individuals, because individuals are counted only once, even if they hold more than one job. In the establishment survey, employees working at more than one job and thus appearing on more than one payroll are counted separately for each appearance. 
If you get really geeky about these things, there are many, many resources that explain these things in greater detail.  Start by reading through all of the notes in the Monthly Employment Situation Report, then check out such BLS pdf's as How the Unemployment Rate is Calculated, then spend some time digging through the BLS tables.  

If you have better things to do, such as cleaning your kitchen or actually earning money, then just follow me.  I'll do the geeky stuff so you don't have to.  Feel free to email me or leave me a comment if there is something you don't understand.  Or email me with a scathing comment if there is something that I got dead wrong, which has happened.

Last year vs. this year:

Even with seasonal adjustments, the twists and turns in the employment numbers are often hard to make sense of.  So, in addition to comparing this month's numbers to last month's numbers, it it also wise to look at employment and unemployment this month vs. the same month a year ago.   

So let's compare these various counts and see what we come up with:

Number of people reporting that they are working now vs. March in absolute "unadjusted" numbers:

138,962,000 vs. 139,661,000 means 699,000 more people are reporting that they are working this month in "unadjusted" real numbers.

Number of people reporting that they are working now vs. March in seasonally adjusted numbers:

139,864,000 vs. 139,674,000 means that 190,000 fewer people are working this month in adjusted numbers. 

Number of people reporting that they are working now vs. April 2010 in absolute numbers:

139,302,000 vs. 139,661,000 means that 359,000 more people are working this month than last year.

Number of people reported as working now vs. April 2010 in adjusted numbers:

139,382 vs. 139,674 means that 292,000 more people are working this month than last year in adjusted numbers.


Bottom Line:  There has been a reasonable and significant uptick in the number of people reporting they are employed compared to last month and compared to last year.  

Number of jobs reported by employers now vs. March in unadjusted "raw" absolute numbers:

129,919 vs. 131,088 means that 1,169,000 more actual  jobs are reported by employers now than in March.

Number of jobs reported by employers now vs.  March in seasonally adjusted numbers:

130,784,000 vs. 131,028,000 means that 244,000 more jobs are reported by employers now in adjusted numbers than in March.

Number of jobs reported employers now vs. April 2010 in absolute numbers:

129,698,000 vs. 131,088,000 means that 1,390,000 more jobs have been reported by employers now in unadjusted numbers than a year ago in April 2010.

Number of jobs reported by employers now vs. April 2010 in adjusted numbers:

129,715,000 vs. 131,028,000 means that 1,313,000 more jobs have been reported by employers now in adjusted numbers than a year ago.


Bottom Line:  Again, there has been a reasonable and significant uptick in the number of jobs reported by employers compared to last month and compared to last year in both unadjusted and adjusted numbers.
  
Now, questions and answers:


Argh!!  The unemployment rate is up (that's bad) but the number of jobs is up (that's good!).  How can that be?


The "official" unemployment rate is a percentage of the number of people officially unemployed (seasonally adjusted) vs. the total "civilian labor force".  The unemployment rate can go up even if the number of jobs goes up for several reasons:
  • As mentioned above, the number of jobs reported and the number of people reporting their employment or unemployment come from two different sources that sometimes do not jive.  Over a period of months, they are usually fairly consistent, but they can vary from one month to the next.  So employers can report more jobs, but workers can report less work.  That is kind of what happened in April 2011.  
  • Seasonal fluctuations can mean that a good jobs report in absolute numbers can look not that good in adjusted numbers or vice verse.  That is also what happened in April 2011.  Usually a trend will be evident over a period of a few months.
  • More people can flock into the labor force and start looking for work, temporarily increasing the unemployment rate.  This often happens at the end of a period of high unemployment.  As people start to see more jobs, they decide to again start looking for work.  Civilian work force expands, but the number of people reporting that they are employed doesn't expand quite as fast.  This should also even out after a couple of months.      
So.. just how many more people are actually working this month vs. last month?


Using the numbers listed above, between 699,000 and 1,169,000 people are working in April who were not working in March.  


So... just how many more people are actually working this month than a year ago?


Using the numbers listed above, between 359,000 and 1,390,000 more people are working in April than in April 2010 a year ago.



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