Unemployment Falling As The Workforce Shrinks

The Bureau of Labor Statistics website is doing its thing this morning where it responds to media interest in the monthly jobs report by crashing, so I’m having some trouble pouring deep into the internals of the numbers. But the headline result here is a net gain of 120,000 jobs. That means you’re basically treading water relative to population growth. But for yet another month what we had was a private sector jobs increase above the waterline (140,000 jobs) rolled back by reductions in public sector payrolls costing us 20,000 jobs, of which 5,000 came from the Postal Service. If the public sector were growing in line with population growth, then throughout this year we’d have been steadily chopping away at the unemployment rate.

Meanwhile, this months’ report actually does see a large decline in the reported unemployment rate down to 8.6%. But that number is driven by a decline in the size of the measured workforce. This is the path to the Antarctic Labor Market Miracle, but it’s not really a strategy for enduring prosperity.

The best news that you’ll find in this report is in the revisions, “The change in total nonfarm payroll employment for September was revised from +158,000 to +210,000, and the change for October was revised from +80,000 to +100,000.” That turns September into a good month and October into a non-terrible one.