The release of January’s job numbers has set the stage for a perplexing economic puzzle, leaving analysts scratching their heads. The discrepancy between two key employment surveys – the Household survey and the Establishment survey – has raised concerns and sparked a debate over the accuracy of the data.
In the Household survey, the 3.7% unemployment rate seems to offer a silver lining, suggesting an overall positive trend. However, the devil lies in the details, as this seemingly positive news masks a more nuanced reality.
The real puzzle emerges when we turn our attention to the Establishment survey, which reports a gain of 335k jobs. This apparent job growth contradicts the decline in full-time workers, marking a departure from the overall narrative of recovery.
Digging deeper, the so-called “good news” from the Household survey loses its shine. The decline in full-time workers by 63k in January, following a substantial drop of 1.5 million in December, raises serious questions about the strength of the labor market.
The situation becomes more complex when considering that part-time workers surged by 211k, reaching a two-year high of 4.4 million. This not only contradicts the narrative of a robust recovery but also hints at a shift toward precarious employment.
Adding another layer to the mystery is the fact that the 3.7% unemployment rate appears disconnected from the underlying employment trends. The decrease in employment by 31k in January, coupled with the departure of 175k individuals from the workforce, raises eyebrows about the real health of the job market.
So, what could be the missing link in this economic conundrum? Could unaccounted immigration be the hidden variable that explains the discrepancy between the two surveys?
The possibility of unreported immigration playing a role in this puzzle is a valid point of consideration. The job market’s complexity is magnified when we acknowledge that both surveys come from the Current Employment Statistics (CES) series but provide opposing narratives.
The diverging stories within the CES series not only highlight the uncertainty in the reported data but also underscore the need for a closer examination of the factors influencing job statistics.
As analysts and policymakers grapple with deciphering the job data enigma, the role of untallied immigration becomes a focal point. Is it the missing link that could reconcile the disparities between surveys and provide a more accurate reflection of the true state of the labor market?
The coming months will likely bring more clarity, but for now, the January job numbers leave us with a compelling economic mystery, prompting us to question whether we have the full picture or if there are hidden variables at play in the ongoing saga of the job market recovery.
Sources:
Jan decline in full-time workers of -63k follows Dec decline of -1.5M
People who choose to believe bubbleheads on bubblevision are providing the full story are clearly not among those who’ve lost their full-time jobs
Those forced to work part-time rose 211k to 2-yr high of 4.4M t.co/qHrG6Epno8
— Danielle DiMartino Booth (@DiMartinoBooth) February 2, 2024
3.7% you reference is Household survey; it differs from Establishment survey, which showed 335k gain
“Good news” wrt 3.7% was because Employment fell, -31k in Jan on top of -683k in Dec & because 175k left workforce in addition to 675k who gave up in Dec
Do you feel better now? t.co/B6nGLhlYzs
— Danielle DiMartino Booth (@DiMartinoBooth) February 2, 2024
“Household employment appears to have grown at less than one-third the pace of payroll gains, which makes no sense whatsoever.”
This column asks if un-tallied immigration can explain the discrepancy between the two surveys.
THOUGHTS? t.co/eln8EzUv7D
— Danielle DiMartino Booth (@DiMartinoBooth) February 2, 2024
Enough is enough. This is getting out of control.
It isn't just HH Survey vs. Est Survey any longer, these are from the same damn series.
Both of are CES, yet they are saying the exact opposite thing about the labor market situation. pic.twitter.com/9vKRdIqToM
— Jeffrey P. Snider (@JeffSnider_EDU) February 2, 2024
Look at heavy truck sales too
— Financelot (@FinanceLancelot) February 2, 2024