Seasonal adjustments change the July 2012 job picture.
It's that time of the year again. We're entering a time of the year in which the "raw" unadjusted numbers of jobs and workers is LESS than the "seasonally adjusted" numbers of jobs and workers. This is primarily due to jobs in the education sector that disappear or end during the summer. (Click this link for more explanation and information about seasonal adjustments.)
So here are a few facts and figures:
In July 2012, in "raw" unadjusted numbers, we:
- LOST 1,204,000 jobs in total.
- ADDED 27,000 private sector jobs.
- LOST 1,204,000 government sector jobs.
- Of those government sector jobs lost, 1,225,600 were in "local government: Education"
- 76,000 FEWER people say they are employed
- 1,204,000 total jobs LOST seasonally adjusted to 163,000 total jobs ADDED
- 27,000 private jobs ADDED seasonally adjusted to 172,000 private jobs ADDED
- 1,231,000 government jobs LOST seasonally adjusted to 9,000 government jobs LOST
- 1,225,600 "Local government education" jobs lost seasonally adjusted to 7,000 local government education jobs lost
- 76,000 fewer people employed adjusted to 195,000 FEWER people employed
Actually, the jobs/employment picture for July MAY be BETTER than the BLS numbers portray as you can see from the chart below.
Even though numbers are seasonally adjusted, it is always a good idea to compare year over year numbers, both adjusted and unadjusted year over year numbers, before jumping to any conclusions.
Here's how the private and government jobs numbers look for the month of July since 2000:
The red bars represent the huge annual decrease in government jobs, almost all of which represent a decline in "Local Government Education". This year's decrease in government jobs is lower than it has been in the prior two years. The blue bars represent the decrease or increase in private sector jobs which is usually a decline or a minor increase in July. The green and black bars represent the adjusted numbers.
Notice that we had only one year with "real" unadjusted private sector job growth in July from 2000 until 2009, and that was 2005 with only an addition of 5,000 private sector jobs. This July has been the second best July for private sector job growth in 12 years in unadjusted "real" numbers.
In terms of adjustments, notice that the additional 5,000 private sector jobs in 2005 "adjusted" to an increase of 280,000 private sector jobs. This year, the additional 27,000 private sector jobs only "adjusted" to 172,000 new private sector jobs. I do see some of these discrepancies whenever I compare adjusted and unadjusted numbers, and I really don't understand why these adjustments can be so different from one year to the next. If the adjustment this year has been along the lines of the adjustment in 2005, we would be celebrating 300,000 new jobs instead of complaining about "only" 172,000.