Today’s employment situation report was in our opinion a mixed bag.
The household survey showed a very large rise in employment (+873,000) and a substantial decline in unemployment (-456,000). The unemployment rate fell to 7.8%, the lowest level 44 months. However, this survey can be very volatile.
The establishment survey showed private sector jobs rising 104,000 during the month.
Hourly earnings and weekly earnings rose.
If we assume a similar advance in inflation as last month, hourly earnings and weekly earnings fell in inflation-adjusted terms. So while nominal wages rose, workers earned less after the impact of inflation.
Part-time work for slack rose during the month.
Manufacturing hiring has stagnated.
U-6 unemployment, which is a broader measure than the unemployment rate, stayed constant at 14.7%.
We see the report as generally positive and indicative of a still slowly growing economy.
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