Payroll employment rises by 223,000 in June; unemployment rate declines to 5.3% [View all]

[mahatmakanejeeves]

Last edited Mon Jul 27, 2015, 09:19 AM - Edit history (19)

Source: U.S. Bureau of Labor Statistics

Economic News Release

Employment Situation Summary USDL-15-1274
Transmission of material in this release is embargoed until 8:30 a.m. (EDT) Thursday, July 2, 2015

Technical information:
Household data: [phone] * [email protected] * www.bls.gov/cps
Establishment data: [phone] * [email protected] * www.bls.gov/ces

Media contact: [phone] * [email protected]


THE EMPLOYMENT SITUATION -- JUNE 2015


Total nonfarm payroll employment increased by 223,000 in June, and the unemployment rate declined to 5.3 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services, health care, retail trade, financial activities, and in transportation and warehousing.

Household Survey Data

The unemployment rate declined by 0.2 percentage point to 5.3 percent in June, and the number of unemployed persons declined by 375,000 to 8.3 million. (See table A-1.)
....

The number of long-term unemployed (those jobless for 27 weeks or more) declined by 381,000 to 2.1 million in June. These individuals accounted for 25.8 percent of the unemployed. Over the past 12 months, the number of long-term unemployed has declined by 955,000. (See table A-12.)

The civilian labor force declined by 432,000 in June, following an increase of similar magnitude in May. The labor force participation rate declined by 0.3 percentage point to 62.6 percent in June. The employment-population ratio, at 59.3 percent, was essentially unchanged in June and has shown little movement thus far this year. (See table A-1.)
....

Among the marginally attached, there were 653,000 discouraged workers in June, essentially unchanged from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.3 million persons marginally attached to the labor force in June had not searched for work for reasons such as school attendance or family responsibilities. (See table A-16.)
....

Establishment Survey Data
....

In June, average hourly earnings for all employees on private nonfarm payrolls were unchanged at $24.95. Over the year, average hourly earnings have risen by 2.0 percent. Average hourly earnings of private-sector production and nonsupervisory employees edged up by 2 cents to $20.99 in June. (See tables B-3 and B-8.)
....

The change in total nonfarm payroll employment for April was revised from +221,000 to +187,000, and the change for May was revised from +280,000 to +254,000. With these revisions, employment gains in April and May combined were 60,000 lower than previously reported. Over the past 3 months, job gains have averaged 221,000 per month.

_____________
The Employment Situation for July is scheduled to be released on Friday, August 7, 2015, at 8:30 a.m. (EDT).

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

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[center]Facilities for Sensory Impaired[/center]

Information from this release will be made available to sensory impaired individuals upon request. Voice phone: [phone], Federal Relay Services: 1-800-877-8339.


[center]Dedication[/center]

How about Uncle Sam? We've made a lot of mistakes, but here we are, 239 years later, and we somehow manage to do good things too.

Ladies and gentlemen, our national anthem:

Like this country, it's not without its mistakes, but overall, it's not bad at all:

[center]Introduction[/center]

Good morning, Freepers and DUers alike. I especially welcome our good friends from across the aisle. You're paying for this information too, so I am absolutely delighted to have you participate in this thread. Please, everyone, put aside your differences long enough to digest the information. After that, you can engage in your usual donnybrook.

I would like to note this: "The change in total nonfarm payroll employment for April was revised from +221,000 to +187,000, and the change for May was revised from +280,000 to +254,000. With these revisions, employment gains in April and May combined were 60,000 lower than previously reported."

If you don't have the time to study the report thoroughly, here is the news in a nutshell:

Commissioner's Statement on The Employment Situation

It is easy to find one paragraph, or one sentence, or one datum in this report that will support the most outlandish of conclusions, from "the sky is falling" to "we'll have blue skies, nothing but blue skies, from now on." Easy, but disingenuous.

Every month, you can find something in the report that will cause you concern. One such nugget is the "labor force participation rate." Take the information in context. Consider not just this month’s data, but the trend.

Please take the time to look at progree's not-to-be-missed thread containing his thoughtful analysis, updated monthly. Here is the latest version:

Economy facts with links to official sources, rev 7/2/15.

Thank you so much for that, progree.

Let's begin with a couple of questions. Who is this Bureau of Labor Statistics, and why are they releasing all these numbers every month?

The Bureau of Labor Statistics (BLS) is a unit of the United States Department of Labor. It is the principal fact-finding agency for the U.S. government in the broad field of labor economics and statistics and serves as a principal agency of the U.S. Federal Statistical System. The BLS is a governmental statistical agency that collects, processes, analyzes, and disseminates essential statistical data to the American public, the U.S. Congress, other Federal agencies, State and local governments, business, and labor representatives. The BLS also serves as a statistical resource to the Department of Labor, and conducts research into how much families need to earn to be able to enjoy a decent standard of living.

The BLS data must satisfy a number of criteria, including relevance to current social and economic issues, timeliness in reflecting today’s rapidly changing economic conditions, accuracy and consistently high statistical quality, and impartiality in both subject matter and presentation. To avoid the appearance of partiality, the dates of major data releases are scheduled more than a year in advance, in coordination with the Office of Management and Budget.

Note carefully those words: "accuracy," "quality," and "impartiality."

Full disclosure: I do not work for BLS, nor am I friends with anyone over there. I'm just someone who appreciates the work they do. My sole connection with the agency is that I've been in the building to pick up some publications.


[center]Household Survey vs. Establishment Survey[/center]

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.

[center]We Got the Beat.[/center]

June Jobs Report: Everything You Need to Know

8:01 am ET
Jul 2, 2015
Markets


—Associated Press

Yes, it’s that time again, folks. Jobs Friday, when for one ever-so-brief moment, the interests of Wall Street, Washington and Main Street are all aligned on one thing: jobs.

This month, however, given the timing of the Fourth of July holiday, the Bureau of Labor Statistics is releasing the jobs report a day early. So Jobs Friday becomes Jobs Thursday.

The BLS is expected to report that the economy added 233,000 jobs in June, with the unemployment rate falling to 5.4%. In May, the economy added 280,000, and the unemployment rate was 5.5%.

Here at MoneyBeat HQ, we’ll crunch the numbers and compile the commentary before and after the data crosses the wires. Feel free to continue the conversation in the comments section. And while you’re here, why don’t you sign up to follow us on Twitter.

-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --

You forgot to say "Enjoy the show."

Before we do anything else, let's give credit to the workers behind the MoneyBeat blog:

The MoneyBeat Team:

Stephen Grocer
Editor

Phillipa Leighton-Jones
European Editor

Erik Holm
Deputy Editor

Maureen Farrell
Reporter, New York

Paul Vigna
Reporter, New York

David Cottle
Reporter, London

[font color="red"]Just added:[/font] Kristen Scholer
Reporter, New York

[font color="red"]Just added:[/font] Giles Turner
Reporter, London

MoneyBeat Columnists

Ronald Barusch
Dealpolitik

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Current Account

Alen Mattich

Jason Zweig
The Intelligent Investor

Michael J. Casey
Horizons

E. S. Browning


[center]The Large Print Giveth, and the Fine Print Taketh Away.[/center]

Long ago, a DU'er pointed out 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 is that link:

Table A-15. Alternative measures of labor underutilization

Also, hat tip, Recursion: How the Government Measures Unemployment

[font color="red"]New material. This link doesn't seem to work for everyone. See progree's tips in post #41:[/font] ETA, on July 25, this link to an article in the July 20, 2015, issue of Barron's:

Refresher Course: Inside the Jobless Numbers

Are we undercounting the unemployment numbers—or overcounting? How the BLS gathers and calculates the numbers, and why it matters.

By Gene Epstein
July 18, 2015

The unemployment rate has never been the object of as much attention from the markets and the media as it is now, sparked by the keen interest taken in its monthly fluctuations by policy makers at the Federal Reserve.

Despite the heightened focus, there are a lot of misunderstandings and misconceptions about how the rate is calculated. Some people assume the Bureau of Labor Statistics compiles the rate from the unemployment-insurance rolls. On that basis, they fault the BLS for undercounting the unemployed. But that’s just one myth among many about this cornerstone measure of economic pain and labor-market slack.

To estimate the unemployment rate, the BLS actually relies on the monthly Current Population Survey conducted for it by the Census Bureau. While the data are highly imperfect in their own way, we think the Federal Reserve is right to view the official unemployment rate as the best available information, while also keeping its eye on ancillary measures of “labor underutilization.”

In fact, a close look at BLS methods suggests that, if anything, the official unemployment rate may be overcounting rather than undercounting the unemployed.

[center]Past Performance is Not a Guarantee of Future Results.[/center]

Nonetheless, what is important is not this month's results, but the trend. Let’s look at some earlier numbers:

ADP® (Automatic Data Processing), for employment in June 2015:

ADP National Employment Report: Private Sector Employment Increased by 237,000 Jobs in June

Bureau of Labor Statistics, for employment in May 2015:

Payroll employment rises by 280,000 in May; unemployment rate essentially unchanged (5.5%)

ADP® (Automatic Data Processing), for employment in May 2015:

ADP National Employment Report: Private Sector Employment Increased by 201,000 Jobs in May

Bureau of Labor Statistics, for employment in April 2015:

Payroll employment rises by 223,000 in April; jobless rate essentially unchanged (5.4%)

ADP® (Automatic Data Processing), for employment in April 2015:

ADP National Employment Report: Private Sector Employment Increased by 169,000 Jobs in April

Bureau of Labor Statistics, for employment in March 2015:

Payroll employment increases by 126,000 in March; unemployment rate unchanged at 5.5%

ADP® (Automatic Data Processing), for employment in March 2015:

ADP National Employment Report: Private Sector Employment Increased by 189,000 Jobs in March

Bureau of Labor Statistics, for employment in February 2015:

Payroll employment increases in February (+295,000); unemployment rate edges down to 5.5%

ADP® (Automatic Data Processing), for employment in February 2015:

ADP National Employment Report: Private Sector Employment Increased by 212,000 Jobs in February

Bureau of Labor Statistics, for employment in January 2015:

Payroll employment rises in January (+257,000); unemployment rate changes little (5.7%)

ADP® (Automatic Data Processing), for employment in January 2015:

ADP National Employment Report: Private Sector Employment Increased by 213,000 Jobs in January


[center]Nattering Nabobs of Negativism[/center]

[font color="red"]Revised material:[/font] Here’s a grim thought:

Fed economists: America’s missing workers are not coming back

Wonkblog

By Max Ehrenfreund September 12 {2014}

A paper by Federal Reserve staff that will be discussed at the Brookings Institution on Friday {September 12, 2014} possibly hints at the central bank's thinking on interest rates and employment in advance of a consequential Fed meeting next week. The findings support [links:http://online.wsj.com/articles/fed-minutes-rate-hike-debate-heating-up-1408557628|hawks] on the Federal Open Market Committee, who feel that the Fed needs to prepare to raise rates sooner than expected, although the results are still being debated and might not persuade the committee's more dovish members.

The paper discusses the number of people who consider themselves part of the workforce -- including both people who have a job and those who are looking for work. It is a measure of the total manpower available in the U.S. economy. This number, the labor force participation rate, has been decreasing steadily since 2000. Americans who can't find work have been leaving the workforce, as have more and more retirees as the population ages.

Let’s follow that with another grim thought:

Why wage growth disparity tells the story of America's half-formed economic recovery

By Chico Harlan November 21, 2014
@chicoharlan
[email protected]

....
With unemployment down to 5.8 percent, the country’s half-formed recovery is often described with a convenient shorthand: We have jobs but little wage growth. But stagnancy is just an average, and for many Americans, the years since the financial crisis have pushed them farther from the line, according to a detailed analysis of government labor statistics by The Washington Post.
....

Among the winners in this climate: Older workers, women and those with finance and technology jobs. ... Among the losers: Part-timers, the young, men, and those in the health, retail and food industries.
....

Chico Harlan covers personal economics as part of The Post's financial team.

Dissenters, take note:

A New Reason to Question the Official Unemployment Rate

David Leonhardt
AUG. 26, 2014

The Labor Department’s monthly jobs report has been the subject of some wacky conspiracy theories. None was wackier than the suggestion from Jack Welch, the former General Electric chief executive, that government statisticians were exaggerating job growth during President Obama’s 2012 re-election campaign. Both Republican and Democratic economists dismissed those charges as silly.

But to call the people who compile the jobs report honest, nonpartisan civil servants is not to say that the jobs report is perfect. The report tries to estimate employment in a big country – and to do so quickly, to give policy makers, business executives and everyone else a sense of how the economy is performing. It’s a tough task.

And it has become tougher, because Americans are less willing to respond to surveys than they used to be.

A new academic paper suggests that the unemployment rate appears to have become less accurate over the last two decades, in part because of this rise in nonresponse. In particular, there seems to have been an increase in the number of people who once would have qualified as officially unemployed and today are considered out of the labor force, neither working nor looking for work.

[center]On the Road Again[/center]

The DOL Newsletter - October 6, 2011

DOL Data: There's an App for That
Have an iPhone, iPod Touch or Android phone? Now you can access the latest labor data and news from the department's Bureau of Labor Statistics and Employment and Training Administration in the palm of your hand. The latest free mobile app displays real-time updates to the unemployment rate, Unemployment Insurance initial claims, the Consumer Price Index, payroll employment, average hourly earnings, the Producer Price Index, the Employment Cost Index, productivity, the U.S. Import Price Index and the U.S. Export Price Index in real time, as they are published each week, month or quarter. News releases providing context for the data can also be accessed through the app and viewed within a mobile browser or as PDF documents.

US Labor Department launches economic and employment statistics app

Smartphone users gain mobile access to latest labor data and news

WASHINGTON — The most up-to-date employment data and economic news releases from the U.S. Department of Labor's Bureau of Labor Statistics and its Employment and Training Administration now can be viewed using a new mobile application.
....

The new app is currently available for the iPhone and iPod Touch as well as Android phones. The Labor Department is working to develop versions for BlackBerry and iPad devices. Visit http://m.dol.gov/apps/ to download this and other mobile apps.

Download the Data, Other Mobile Apps


[center]A Few More Things[/center]

Every month, someone will cite the labor force participation rate as a cause for concern. This July 2014 report from the Council of Economic Advisers addresses that:

THE LABOR FORCE PARTICIPATION RATE SINCE 2007: CAUSES AND POLICY IMPLICATIONS

(Hat tip, Adrahil: Look deeper.)

Meet FRED, every wonk’s secret weapon

Storyline ? Meet the wonks

By Todd C. Frankel August 1, 2014

FRED stands for Federal Reserve Economic Data. It serves as an online clearinghouse for a wealth of numbers: unemployment rates, prices of goods, GDP and CPI, things common and obscure. Today, FRED is more than a little bit famous, thanks to the public’s fascination with economic data.

Federal Reserve Economic Data

So how many jobs must be created every month to have an effect on the unemployment rate? There's an app for that:

Federal Reserve Bank of Atlanta Jobs Calculator™

(Note new link for Jobs Calculator™. Hat tip, progree.)

Monthly Employment Reports from BLS

The U.S. Census Bureau has its own releases:

U.S. Census Bureau Latest News

U.S. Census Bureau Economic Indicators

For people who need a daily fix:

BLS-Labor Statistics Twitter feed

Read tomorrow's news before it happens. The schedule for all economic reports:

MarketWatch Economic Calendar