Back on February 2, a Tom Blumer Newsbusters column complained that journalists were reporting January job growth even though in the real world millions of people lost their jobs. He was right! January is always a month of net job losses. When the BLS says we added jobs in January, what they mean is that we lost fewer jobs than the seasonal adjustment algorithm expected.
But by the same token, there’s always a strong rebound in February. The 236,000 seasonally adjusted jobs we added in February are actually 960,000 jobs. As you can see above, if you compare the red line (unadjusted) to the blue line (seasonally adjusted) the month-to-month seasonal fluctuations are much larger than the overall business cycle. In that sense—if in no others—“real business cycle”-style accounts of the economy remain important. If you look at the unadjusted data, you’ll see clearly that even in an advanced service economy the ups and downs of the weather and the traditions surrounding our winter solstace festival are the key drivers of economic activity. The government has developed a sound method for screening that stuff out, which makes the policy-relevant macroeconomic factors pop out more.