Home Economy Was a few of final 12 months’s job-market power “overstated”?

Was a few of final 12 months’s job-market power “overstated”?



Right here’s a enjoyable query to dig into forward of Friday’s US jobs report: did BLS estimates overstate labour-market progress within the second quarter of 2022?

A number of information factors present as a lot, in keeping with a Thursday presentation from Barclays. The economists discovered a doable overstatement of about 440,000 jobs. In contrast towards the official US estimate of simply over 1mn jobs, that appears, uh, important.

However Barclays says that’s much less dire an image than a few different experiences out just lately:

1) Final week’s report on Enterprise Employment Dynamics, or BDM, estimates {that a} web 287,000 jobs had been misplaced within the second quarter, seasonally adjusted.

2) The Philly Fed’s early benchmark revisions of state payroll employment, printed in December, says that simply 10,500 web new jobs had been created that quarter, on a seasonally adjusted foundation.

So, relying on who you hearken to, US private-sector jobs had been both created, destroyed, or basically unchanged within the second quarter of final 12 months.

To give you their estimate of the BLS’s overstatement of 440k, Barclays’ economists go the supply of each the Philly Fed and BDM information, the BLS’s Quarterly Census of Employment and Wages, or QCEW. (They guess that each the Philly Fed and BDM experiences utilized wonky seasonal changes.)

The QCEW report could be very dependable, Barclays says. “Since almost all employers are required to take part in UI, that is shut to a whole Census rely, overlaying about 97 per cent of general workers,” the economists write of their presentation.

QCEW information is used to benchmark the general stage of NFP payrolls in the beginning of every 12 months.

Tomorrow’s report (on January jobs creation) will subsequently be benchmarked to the QCEW’s numbers from 1Q22. And since the BLS solely benchmarks its annual payroll numbers to the prior March, the 2Q job-creation figures gained’t be revised to extra correct ranges till subsequent 12 months.

To keep at bay any political commentary: this can be a bit area of interest to be a plot from the “Chicago guys”, but it surely’s fascinating however!

Stats heads might discover extra notable element within the charts beneath. within the full presentation. [Updated, as Barclays compliance was less than ecstatic about linking to their full report.]



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