The jobs report for October just came out. Headline numbers:
Payrolls up 80,000. That's below the average of the past year -- about 125,000 per month. Once again, private sector jobs went up (104,000); public sector, down (-24,000).
Unemployment ticked down to 9%.
Revisions to September and August added about 100,000 on payrolls, cumulatively, to those months.
We're just very much stuck in a slog here. The private sector is expanding at a snail's pace, while state and local governments continue to cut jobs. It's a vicious cycle where weak employment growth is leading to weak wage* and income growth and that's dampening consumption and GDP growth. And as long as consumers remain strapped, it's hard for me to see why corporations sitting on trillions in cash reserves would invest here as opposed to expanding, emerging economies elsewhere.
Meanwhile, Congress remains in a fantasyland, wallowing in a well-deserved 9% approval rating and blocking every idea that might actually stimulate some job growth.
I don't mean to get all statistical on you this early in morning, but I always like to think about the confidence intervals (statistical reliability) around these employment numbers.
For the payroll survey, the 90% confidence interval for the monthly change in jobs is about 100,000; for the Household survey, it's about 400,000(!).
The means that monthly numbers at or below those levels are statistically indistinguishable from no change at all (more precisely, they will be 90% of the time).
I raise this today because I suspect we'll hear some people get all jiggy about the growth of employment in the Household survey of 277,000. But that's well below the confidence interval of 400,000 (the sample size is a lot smaller in the Household survey; ergo, the wider confidence interval).
That doesn't mean there's no information in the headline numbers for months like October, where the change in both employment numbers is statistically insignificant (as is the change in the unemployment rate, by the way, from 9.1% to 9%; on the other hand, the increase in private sector payrolls of 125K is significant). If you average over a bunch of months, you're essentially increasing the sample size and that gives a more reliable read (which confirms the slog I mentioned).
But let's not forget our stats 101, America!
* Year-over-year, wages were up 1.8%. Consumer prices are rising, as of September, by 3.9% meaning real wages-the buying power of paychecks-are falling.
This post originally appeared at Jared Bernstein's On The Economy blog.