Insights and Perspectives

Employment Remains Above 200K, but Shows Signs of Slowing

Fri, 06 Jan 2023 15:55:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for December 2022 on Friday, January 6^th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market.

Employment in the U.S. rose by 223,000 jobs. The jobs results ended up between the Geographic Solutions, Inc. forecast of 273,000 and the WSJ forecast of 200,000. Job growth has been slightly softening since August 2022. Additionally, with the exceptions of the outbursts in job creation in February and July 2022 depicted in the above chart, job growth has been gradually weakening since October 2021. Geographic Solutions, Inc. derives its employment forecast from internal data on the number of job searchers and applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate fell to 3.5%, below the Geographic Solutions and WSJ forecasts of 3.7%. The unemployment rate forecast uses internal data on the number of job openings, job searchers, job applications, unemployment applications, and job severances on Geographic Solutions state client sites. The forecast uses unemployment claims data from the USDOL.

Job creation was strongest in Education & Health Services (78,000) and Leisure & Hospitality (67,000). Job growth was flat in all other industries except Trade, Transportation, & Utilities and Construction which gained a combined 55,000 jobs.

While all sectors continued to grow in 2022, Leisure & Hospitality and Government are the only major sectors to remain below their pre-pandemic employment level.

The labor force participation rate increased to 62.3% from the previous month. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment declined to 6.5%.

The U.S. labor market expanded by 4.5 million jobs in 2022 as recovery from the Covid-19 pandemic continues. Despite this impressive achievement, it appears that the Federal Reserve’s drastic interest rate increases have managed to slow the pace of job growth throughout the year, albeit unevenly. Wage increases also seem to be tapering off. Both of those developments bode well for taming inflation and bringing price relief to consumers in 2023. The main question in the new year is will the Federal Reserve be able to accomplish this without pushing the labor market into a downturn.

Job Creation Maintains Healthy Expansion in May

Fri, 03 Jun 2022 13:19:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for May 2022 on Friday, June 3^rd. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market.

Employment in the U.S. rose by 390,000 jobs. The jobs report exceeded the Geographic Solutions, Inc. forecast of 205,000. While the result is significantly higher than expectations, it remains well within the prediction interval during such a volatile period. The Wall Street Journal forecast of 328,000 was closer to the result. Geographic Solutions, Inc. derives its employment forecast from internal data on the number of job searchers, job applications, job severances, and applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate remained the same at 3.6%, exactly at the Geographic Solutions forecast and above the WSJ forecast of 3.5%. The unemployment rate forecast used internal data on the number of job openings, job searchers, job applications, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the USDOL.

Job creation was strongest in Leisure & Hospitality (84,000), Professional & Business Services (75,000), and Education & Health Services (74,000). Job growth was flat to positive in all industries.

While Manufacturing employment did not emerge past its pre-pandemic level in May as expected, the Information sector did, joining Construction; Professional & Business Services; Trade, Transportation, & Utilities; and Financial Activities as one of the sectors that has recovered all jobs lost since the beginning of the pandemic. Leisure & Hospitality employment continues to grow but is the only sector to remain more than 3% below its pre-pandemic employment level.

Employment may be settling into a monthly pattern of 400,000 new jobs which can be expected to continue for a few more months. However, the labor market picture becomes murkier afterwards as consumers deplete savings accumulated from pandemic relief while wage increases are still below the rate of inflation.

Job Creation Maintains Healthy Expansion in April

Fri, 06 May 2022 12:34:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for April 2022 on Friday, May 6^th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market.

Employment in the U.S. rose by 428,000 jobs. The jobs report fell short of the Geographic Solutions, Inc. forecast of 580,000. The Wall Street Journal forecast of 400,000 was closer to the result. Geographic Solutions, Inc. derives its employment forecast from internal data on the number of job searchers, job applications, job severances, and applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate remained the same at 3.6%, above the Geographic Solutions and WSJ forecast of 3.5%. The unemployment rate forecast used internal data on the number of job openings, job searchers, job applications, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the USDOL.

Job creation was strongest in Trade, Transportation, & Utilities (104,000) and Leisure & Hospitality (78,000). Job growth was flat to positive in all industries.

Manufacturing is poised in May to join Construction; Professional & Business Services; Trade, Transportation, & Utilities; and Financial Activities as one of the sectors that has recovered all jobs lost since the beginning of the pandemic. Leisure & Hospitality employment continues to grow but is the only sector to remain more than 5% below its pre-pandemic employment level.

The labor force participation rate declined to 62.2% from the previous month. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment ticked up to 7.0%.

March employment continued its record streak of growing by more than 400,000 jobs per month since May 2021. At this pace jobs should return to their February 2020 total in three months. The labor market has been running hot for several months, but it is uncertain when increasing wage gains are going to have a dampening effect on employment.

Job Creation Jumps as Omicron Fears Subside in February

Fri, 04 Mar 2022 13:52:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for February 2022 on Friday, March 4^th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market.

Employment in the U.S. rose by 678,000 jobs. The jobs report exceeded the Geographic Solutions, Inc. forecast of 507,000 but is much more in line with the actual results than the last several volatile months (which also included volatile revisions to previous reports). The Geographic Solutions, Inc. forecast outperformed the Wall Street Journal estimate of 440,000 new jobs. The Geographic Solutions, Inc. forecast was derived from internal data on the number of job searchers, job applications, job severances, and applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate fell to 3.8%, below the Geographic Solutions and WSJ forecasts of 3.9%. The unemployment rate forecast used internal data on the number of job openings, job searchers, job applications, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the USDOL.

Job creation was strongest in Leisure & Hospitality (179,000). Education & Health Services (112,000) and Professional & Business services (103,000) also had strong showings for the month. Every major industry saw job increases in February.

Professional & Business Services; Trade, Transportation, & Utilities; and Financial Activities are above their pre-pandemic highs with construction poised to meet its pre-pandemic level next month.

The February employment figures built upon the encouraging performance in the jobs market since October of last year. While the labor market has shown resiliency during the Omicron variant, its gradual alleviation has provided an extra boost for job increases not seen since before the Delta variant took full effect last summer. However, some potential hurdles remain. The Federal Reserve will begin its path of interest rate increases in March to combat the high rates of inflation that have emerged over the last year. With inflation a top concern among consumers, there is also the worry that the Russian invasion of Ukraine will send energy prices soaring. These developments will need to be watched closely going forward, but February overall was a positive month in the U.S. labor market.

Resilient Job Growth In The Face Of Omicron In January

Fri, 04 Feb 2022 16:30:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for January 2022 on Friday, February 4th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market.

Employment in the U.S. rose by 467,000 jobs. The result is a pleasant surprise given the many signals that this would be a bad month. Geographic Solutions, Inc. and public data from the Department of Labor pointed to a negative job performance of -179,000. The job market at this phase of the recovery has become very hard to predict largely from the public’s changing reactions to Covid-19, including the job application behavior of users on Geographic Solutions sites as well as the job openings posted on those sites. Initial jobless claims from the Labor Department also pointed to a downward blip in employment. Furthermore, job revisions have been enormous in the last two years relative to the size of initial reports. December 2021, to take the most recent example, was revised upward from 199,000 to 510,000 which is much closer to the Geographic Solutions forecast of 493,000. The ADP employment report predicted the private sector shed 301,000 jobs in January. The Wall Street Journal estimate was closer at a 150,000 increase in jobs, but their reporting acknowledged the difficulties of assessing the labor market:

For January, consensus is +150,000 but the range of forecasts is wide and whisper number decidedly negative—Goldman Sachs forecasts a decline of 250,000 jobs, Morgan Stanley -215,000, TD Securities -200,000. Truth is, though, that economists have had a hard time during the pandemic, the consensus has frequently been off the mark and the whisper wildly wrong.

The Geographic Solutions forecast was derived from internal data on the number of job searchers, and applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate ticked up to 4.0%, below the Geographic Solutions forecast of 4.1% and above the WSJ forecast of 3.9%. The unemployment rate forecast used internal data on the number of job openings, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the USDOL.

Job creation was strongest in Leisure & Hospitality (151,000) and Transportation, & Utilities (132,000). Every major industry except for Construction (-5,000) saw job increases in January. Government employment increased with Local Government Education surging.

More sectors emerged above their pre-pandemic employment level: Professional & Business Services, Trade, Transportation, & Utilities, and Financial Activities.

The labor force participation rate increased to 62.2% from the previous month. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment fell 0.2% to 7.1%. Steady unemployment rates with a growing labor force participation rate indicate that the labor market is shaking off some of the slack experienced in the early fall.

The January employment figures along with the revisions in December and November portray a labor market that is healthier than thought on first examination. Additionally, it points to resilience that the jobs market has had during the onset of the Omicron variant. The news should be especially well-received at the Federal Reserve as this gives them more leeway to raise interest rates when arguably inflation has become a greater concern than employment among the public.

Business And Household Surveys Continue To Diverge In December

Fri, 07 Jan 2022 14:35:00 GMT

Different performances between surveys as of late may be revealing how the U.S. labor force is shifting during the pandemic recovery.

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for December 2021 on Friday, January 7th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market. However, the different performances between the surveys as of late may be revealing how the U.S. labor force is shifting during the pandemic recovery.

Employment in the U.S. rose by 199,000 jobs. It amounts to less than half of expectations of forecasts that were in the 400,000s with the Geographic Solutions, Inc. forecast at 493,000 and the WSJ Economist Survey projection at 422,000 jobs. The Geographic Solutions forecast was derived from internal data on the number of job searchers, job severances, and applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate dropped to 3.9%, below the Geographic Solutions and WSJ forecasts of 4.1%. The unemployment rate forecast used internal data on the number of job openings, job severances, job searchers, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast used unemployment claims data from the USDOL.

Job creation was strongest in Leisure & Hospitality (53,000) and Professional & Business Services (43,000). Construction, Manufacturing, and Trade, Transportation, & Utilities each grew by more than 20,000 jobs for the month. Government employment continues to flounder, falling for the fifth consecutive month.

Employment figures in all major sectors remain below their February 2020 pre-pandemic levels with the exception of Financial Activities. Leisure & Hospitality which was harmed the most by the pandemic is still more than seven percent below its pre-pandemic jobs.

The U-3 unemployment rate is the standard form of measuring unemployment in the U.S. labor market and includes those that are actively seeking a job but unable to find one. The U-3 unemployment rate declined to 3.9% from the previous month.

The labor force participation rate maintained its rate of 61.9% from the previous month. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment fell 0.5% to 7.3%. Declines in the unemployment rates with a growing or steady labor force participation rate indicate that the labor market is shaking off some of the slack experienced in the early fall.

December presented a continuation of the dichotomy between the Business Establishment Survey (CES) and Household Survey CPS). It is not unusual to see light job growth with a declining unemployment rate. However, that is usually a result of discouraged workers dropping out of the labor force. That was not the case as the labor force participation rate was unchanged from last month. A pattern is emerging of many people taking jobs as self-employed, contract, or “gig-economy” workers which do not get counted in the CES. There has been some reporting to back this up. If this trend continues then judging the state of the recovery should rely more on the unemployment rate and the labor force than the number of recorded new payroll jobs each month.

Even though the last few months of job growth in 2021 were rather disappointing, the overall performance was upbeat for the year with the economy creating 6.4 million jobs when predictions of surveyed economists averaged 6.0 million at the beginning of the year. The substantial decline in the unemployment rate accompanying an increase in the labor force can give us additional optimism heading into 2022.

October 2021 Employment Lifted By Broad-Based Growth In Private Sector

Fri, 05 Nov 2021 18:11:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for October 2021 on Friday, November 5th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market. The results mark 20 months since the Covid-19 economic lockdown.

Employment in the U.S. rose by 531,000 jobs. While an acceleration of job growth was expected, the pace was somewhat higher than most expectations with the Geographic Solutions, Inc. forecast at 353,000 and the WSJ Economist Survey projection at 450,000 jobs. The results are a welcomed change from the previous two months. Even though Leisure & Hospitality again led the way, job growth was across-the-board in the private sector, most likely due to falling Covid-19 cases since the peak of the Delta surge in September. The Geographic Solutions forecast was derived from internal data on the number of job openings and job searchers. The forecast used unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate dropped to 4.6%, matching the Geographic Solutions forecast. The WSJ forecast of 4.7% was slightly higher. The unemployment rate forecast used internal data on the number of job openings, job severances, job applications, job searchers, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites.

Job creation was strongest in Leisure & Hospitality (164,000), including 119,000 in Food Services & Drinking Places. Professional & Business Services and Trade, Transportation, & Utilities each grew by approximately 100,000 new jobs for the month. Government employment fell once again as the seasonal abnormalities in state and local education have persisted into October.

October was a milestone for industry-by-industry employment. The Financial Activities sector became the first to fully recover its employment level from February 2020. A few other industries are approaching their pre-pandemic levels which we are watching closely to see how the labor market has shifted during the recovery.

July 2021 Job Growth Accelerates before Covid-19 Variant Takes Hold

Fri, 06 Aug 2021 16:34:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for July 2021 on Friday, August 6^th. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market. The results mark 17 months since the Covid-19 economic lockdown. While the results are impressive, hurdles lie ahead with the Covid-19 variant leading some states and localities to reinstate some restrictions on activity.

Employment in the U.S. rose by 943,000 jobs, well above the Geographic Solutions, Inc. forecast of 689,000. The WSJ Economist Survey forecasted new jobs to be 845,000. The major surprise came from employment in Local Government Education which grew by 220,700, the largest increase on record since tracking began in 1955. July is typically a low point for jobs in local education, so the BLS typically adjusts it upwards to seasonalize the data. That appears not to have happened this year, perhaps due to educators being called back into work earlier than usual to prepare for school openings under Covid-19 or an expansion of summer programs. The Geographic Solutions forecast was derived from internal data on the number of job openings, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast used unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate dropped to 5.4%, below the Geographic Solutions forecast of 6.1% and the WSJ forecast of 5.7%. The unemployment rate forecast used internal data on job openings, job searchers, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast used unemployment claims data from the USDOL.

Job creation was most pronounced in Leisure & Hospitality (+380,000), the largest driver of new employment for several months even as restaurants and hotels struggle to fill job openings. Job market gains also came from a strong performance in Government that totaled 240,000 new jobs mostly from Local Government Education as already discussed.

Leisure & Hospitality employment continues its climb, but it has a long way to go before completing its recovery. Its employment remains a little more than 10% below February 2020. No other major industry has employment more than 6% below its February 2020 total.

The labor force participation rate ticked up to 61.7% from the previous month. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment fell 0.6% to 9.2%. All indicators are showing that July was a great month for the U.S. labor market.

The July labor market report is about as good as could be reasonably expected. Yet, this news may be dismissed, because of the emergence of the delta variant which mostly happened after the surveys were conducted. While this will have a diminishing effect on the economy, especially in places that will bring back Covid-19 limitations, the overall labor market should see a healthy expansion for the next few months. It will be much needed as the U.S. still has 5.7 million fewer jobs than before the pandemic began in February 2020.

June 2021 Job Growth Returns to Healthy Pace

Fri, 02 Jul 2021 18:20:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for June 2021 on Friday, July 2^nd. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market. The results mark 16 months since the Covid-19 economic lockdown and are a welcome sign that employment has moved past the disappointing pattern which was feared to be emerging in April and May.

Employment in the U.S. rose by 850,000 jobs, only 2% below the Geographic Solutions, Inc. forecast of 867,000. The WSJ Economist Survey forecast at 706 thousand jobs underestimated jobs by more than 20%. The Geographic Solutions forecast was derived from internal data on the number of job openings, job severances, job searchers, job applications, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast used unemployment claims data from the U.S. Department of Labor (USDOL).

The unemployment rate slightly increased to 5.9%, above the Geographic Solutions forecast of 5.5% and below the WSJ forecast of 5.6%. The unemployment rate forecast used internal data on job openings, job applications, job searchers, job severances, and the number of applications for unemployment benefits filed on Geographic Solutions state client sites. The forecast used unemployment claims data from the USDOL.

Job creation was most pronounced in Leisure & Hospitality (+343,000), the largest driver of new employment for several months even as restaurants and hotels struggle to fill job openings. Job market gains also came from a strong performance in Government that totaled 188,000 new jobs. However, Local Government Education (+155,000) strongly suggests that the overall measured increase was mostly due to seasonal adjustments anticipating a “summer recess” effect based on pre-pandemic years.

As stated above, Leisure & Hospitality employment continues its climb, but it has a long way to go before completing its recovery. Its employment remains 13% below February 2020. No other major industry has employment more than 6.5% below its February 2020 total.

The labor force participation rate remained unchanged at 61.6% from the previous month. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment fell 0.4% to 9.8%. When the gap closes between the U-3 and U-6 unemployment rates, it is usually a sign that more people are actively searching for work and possibly abandoning part-time work in order to do so.

The June labor market report will come as a relief to many after earlier lackluster growth. Yet, the U.S. employment level remains 6.7 million jobs below its February 2020 total. The job market would have to generate 1.1 million jobs on average per month to complete the recovery by the end of the year when most surveyed economists are predicting an average of 500,000 for the year. The three crucial factors to watch going forward are lingering fears about the pandemic, parents attending to children not in school or daycare, and state government changes to extended unemployment benefits.

Key Developments in the October 2020 Current Employment Statistics

Sat, 12 Dec 2020 12:54:00 GMT

The Bureau of Labor Statistics (BLS) released its monthly Current Employment Statistics (CES) report and Current Population Survey (CPS) for November 2020 on Friday, December 4th. The results mark nine months since the Covid-19 economic lockdown and seven months since the labor market recovery began. The monthly change in employment given by the CES and the unemployment rate from the CPS are seen as the standard gauges for assessing the health of the U.S. labor market. The CES reports that employment in November 2020 increased by 245,000. The unemployment rate fell to 6.7%. Job creation as of November 12th (the date of the survey) has fallen to a point that is in line with pre-pandemic job numbers (February 2020 had 251 thousand). Now near the December 12th survey date, the weekly initial unemployment benefits averaged for December increased by 20,000. These developments together are fairly discouraging considering that the job market still has 9.8 million jobs left to go to reach its pre-pandemic level in February.

If this pace of job growth continues, it will take over three years for employment to return to its February number. In the previous month, we noticed the different patterns between goods-producing and service-providing industries with goods-producing industries posting accelerated growth for two straight months. However, November jobs in goods-producing industries saw an increase of 55 thousand, down from the 107 thousand the month before.

The job market gains were hampered by a contraction in the number of public employees in November. The government sector was the only industry to decline significantly during the month as seen in the chart below. The public sector job loss was mainly due to the lingering expirations of temporary federal Census jobs. The Retail Trade sub-component of Trade, Transportation, & Utilities also saw a sizeable decline but that was more than offset by the strong performance of its Transportation & Warehousing sub-component. This appears to reflect that the long-term shift to online retail instead of brick-and-mortar retail during the holiday season has been put on steroids by Covid-19.

Leisure & Hospitality continues to struggle after it collapsed in March and April. The bottom line in the graph below illustrates the severity of the pandemic effects on Leisure & Hospitality compared to other industries. Its employment remains 20.4% below February, more than twice the remaining percentage of any other major sector.

On the surface it looks like the fall in unemployment is good news. The U-3 unemployment rate fell last month from 6.9% to 6.7%. However, the labor force participation fell. The U-3 unemployment rate is the standard form of measuring unemployment in the U.S. labor market and includes those that are actively seeking a job but unable to find one. The more expansive U-6 unemployment rate counts discouraged workers who are no longer actively seeking work (and therefore no longer in the labor force) and those that have settled for part-time employment but desire a full-time job. This measure of unemployment ticked down last month by 0.1% to 12.0%. The smaller decline in the U-6 unemployment rate shows that a higher share of the unemployed have become discouraged and are not actively seeking work.

The future for the U.S. job market is a little murkier now. We have to hope that November was a statistical blip and the labor market will return to an aggressive recovery going forward. However, the subsequent initial unemployment claims data does not look promising. The December average of these claims saw an above-zero change for the first month since the recovery began as shown in the chart below. The lower-than-expected jobs outcome may prod some in congress to pass an additional stimulus, but even if that were to happen the economic consequences probably would not be felt until next year.