Payroll employment rises 120,000 in March; unemployment rate changes little (8.2%)

Source: Bureau of Labor Statistics

THE EMPLOYMENT SITUATION -- MARCH 2012


Nonfarm payroll employment rose by 120,000 in March, and the unemployment rate was little changed at 8.2 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in manufacturing, food services and drinking places, and health care, but was down in retail trade.

Household Survey Data

The number of unemployed persons (12.7 million) and the unemployment rate (8.2 percent) were both little changed in March. (See table A-1.)

Among the major worker groups, the unemployment rates for adult men (7.6 percent), adult women (7.4 percent), teenagers (25.0 percent), whites (7.3 percent), blacks (14.0 percent), and Hispanics (10.3 percent) showed little or no change in March. The jobless rate for Asians was 6.2 percent, not seasonally adjusted. (See tables A-1, A-2,and A-3.)

The number of long-term unemployed (those jobless for 27 weeks and over) was essentially unchanged at 5.3 million in March. These individuals accounted for 42.5 percent of the unemployed. Since April 2010, the number of long-term unemployed has fallen by 1.4 million. (See table A-12.)

Read more: http://www.bls.gov/news.release/empsit.nr0.htm

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Oh, dear. This is 89,000 fewer jobs than ADP had estimated. The stock markets in the US are closed today, so we'll have to wait until Monday for a reaction.

A few days ago, ADP weighed in with its estimate:

Businesses Adding 209,000 New Jobs Last Month Fail To Ignite Market Rally

Last month, there were posts at DU reporting ADP's estimate that 216,000 jobs were added in February. Gruntled Old Man started this one, for example:

ADP Estimates U.S. Companies Added 216,000 Jobs in February

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Monthly Employment Reports

The large print giveth, and the fine print taketh away.

A DU'er pointed out several months ago that, if I'm going to post the link to the press release, I should include the link to all the tables that provide additional ways of examining the data. Specifically, I should post a link to “Table A-15. Alternative measures of labor underutilization.” Table A-15 includes those who are not considered unemployed, on the grounds that they have become discouraged about the prospects of finding a job and have given up looking. Here are those links.

Employment Situation

Table A-15. Alternative measures of labor underutilization

From the February 10, 2011, 'DOL Newsletter':

Take Three

Secretary Solis answers three questions about how the Bureau of Labor Statistics calculates unemployment rates.

How does BLS determine the unemployment rate and the number of jobs that were added each month?

BLS uses two different surveys to get these numbers. The “household survey,” or Current Population Survey (CPS), involves asking people, from about 60,000 households, a series of questions to assess each person in the household's activities including work and searching for work. Their responses give us the unemployment rate. The “establishment survey,” or Current Employment Statistics (CES), surveys 140,000 employers about how many people they have on their payrolls. These results determine the number of jobs being added or lost.

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Inevitably each month, I get a few people dissing the BLS, saying that the numbers are just invented or otherwise talking trash about BLS employees. Nonsense. The day after the March 2012 release, the Washington Post ran a story on its front page detailing the timeline of the release of the number. It is well worth reading.

Disclaimer: I do not work at BLS.

http://www.washingtonpost.com/national/jobs-day-an-economic-and-political-obsession/2012/03/09/gIQADZPW1R_story.html

‘Jobs Day’: Monthly release of employment data an economic, political obsession

Watching the clock

By Eli Saslow, Published: March 9
The president’s senior advisers walked into the Roosevelt Room at 8:29 a.m., refreshing the screens on their BlackBerrys in a race to see the monthly employment numbers first. Their daily planning meeting in the White House always felt a bit futile on this one Friday a month, because nobody knew what to plan for, exactly. It was “JOBS DAY,” the words capitalized and bolded on their official White House calendars, because the 8:30 a.m. release of economic data could redefine what came next.
....

The release of employment numbers by the Bureau of Labor Statistics has long been a ritual in Washington, but lately it has turned into an obsession during an election year defined by economic instability. Once each month, a nondescript government agency compiles and releases 24 tables of economic data that have come to define the 2012 election and so much else. Republican presidential candidates turn the numbers into speeches. The president’s staff monitors how they affect his approval rating. The Federal Reserve reevaluates interest rates. Investors prepare for the stock market to rise or fall, sometimes swinging in value by $150 billion in the minutes after the report is released.
....

‘You dream in numbers’

Karen Kosanovich had been working through the numbers in her high-walled cubicle for the past eight days, trying to turn 110,000 lines of raw data into a precise summary understandable to the general public. Empty cans of Red Bull sat on one side of her desk. Folders labeled “CLASSIFIED DATA” stacked high on the other. She had helped compile the past 164 employment situation reports, but still each month began with the same sense of improbability.

The lockdown was an exercise in tedium and precision, but those have been the hallmarks of BLS for 125 years. The agency remains strictly nonpartisan and intentionally bland. It measures the economy without ever opining on it. “The glass here is never half-empty or half-full,” Kosanovich said, repeating a popular BLS motto. “It’s an eight-ounce glass with four ounces of liquid.”

From “AHEAD OF THE TAPE,” on page C1 of The Wall Street Journal. for Friday, March 9, 2012:

Divining the Truth From Jobless Figures

AHEAD OF THE TAPE
Updated March 8, 2012, 7:46 p.m. ET
Divining the Truth From Jobless Figures

....
Much like Apple inc.'s unveiling this week of its latest product upgrade, expect the Labor Department's employment report to provide some dazzle, followed by a letdown and questions about whether employment growth can be sustained.
....

But the official jobs figure, by its nature, invites skepticism, even from Federal Reserve Chairman Ben Bernanke. Last week, he called the labor market “far from normal,” despite a recent sharp decline in the unemployment rate.

One factor possibly at play: seasonal adjustments that massage the total jobs figure higher by many times the expected change in jobs. If such tweaks are just a bit too aggressive, the trend could be misleading. Additionally, distortions dating from the recession may have overinflated adjustments. And this year's warmer-than-normal winter also may provide a false sense of momentum.
....

Just as the company that Steve Jobs founded has struggled to evoke his legendary showmanship, investors are right to worry that jobs data may be more show than reality.

Write to Spencer Jakab at spencer.jakab@dowjones.com