Bureau of Labor Statistics Archives - Page 2 of 3 - Colorado-based Business and Economic Research

Most Recent Labor Report Not What Incumbents Want to Hear

October 12, 2012October 12, 2012 horvath Leave a comment

The October 5th Bureau of Labor Statistics press release was disappointing, particularly for incumbents in the upcoming elections. The report indicated that the U.S. added only 114,000 nonfarm jobs in September. It stated, “Employment increased in health care and in transportation and warehousing but changed little in most other major industries.” While job creation is important, the expansion of these industries does little to create jobs in other sectors.

The recent update also indicated that there are 12 million Americans out of work. Four years ago that number was 9.5 million and 6 years ago it was 6.8 million. The fact that the unemployment rate edged downward to 7.8% seems somewhat irrelevant given this data.

The data can be looked at from a slightly different perspective. That view indicates that the nation has regained about half the jobs lost as a result of the Great Recession. Ugh!

The private sector added 104,000 jobs for the month, while government employment added 10,000 workers. This is the second month in a row for increased government employment. While some have an unfavorable view of job gains in the public sector, in this case, it may be a positive indicator that state and local revenue streams have improved.

The BLS announcement was preceded by the ADP employment report which stated that private nonfarm employment had risen by 162,000 in September, 189,000 in August, and 156,000 in July. At this point, ADP is clearly more optimistic about the recovery than the BLS.

On average, Colorado nonfarm employment comprises about 1.72% of the U.S. total. If Colorado grows at the same pace as the U.S., the state data will gain about 2,000 jobs in September. We’ll see what BLS says in their monthly update on October 19th.

National Jobs Data Continues to Disappoint

September 12, 2012September 12, 2012 horvath Leave a comment

The September 7th Bureau of Labor Statistics press release created an uproar with the announcement that the U.S. added only 96,000 net jobs in August. This “anemic” job creation was accompanied by a downward revision in the July data from 22,000 to 141,000.

The private sector added 103,000 jobs for the month. This means government employment declined by 7,000 workers.

The report came on the heels of the ADP employment report which stated that private nonfarm employment had risen by 201,000 in August and July private sector employment had been revised upward by 10,000. Clearly, the two reports on the same topic tell two distinct stories.

At the same time BLS national unemployment slipped to 8.1%. The decline is relatively insignificant.

Of greater concern than the numbers is the impact the current economic conditions are having on the culture in the American workforce. While it is common for workers to feel like they are not valued or part of the decision making process, those feelings are exacerbated during the current economic environment.

Deborah Brackney, Vice President of the Mountain States Employers Council, recently said in an interview with 9News that “Anywhere from 50-60 percent of employees right now say that if they could find another job, they would leave their current employer.” She also added that a recent Gallup poll shows that only 30 percent of employees are engaged in the workplace. Lost productivity associated with this lack of involvement in the company is approximately $300 billion. A critical source of the problem is the lack of communications in the workplace.

In other words, the impacts of the Great Recession have touched both unemployed and employed workers in significant ways.

On average, Colorado nonfarm employment is about 1.72% of the U.S. total. If Colorado grows at the same pace as the U.S. the state data will reflect a gain of about 1,650 jobs. We’ll see what BLS says on September 21.

Unemployment Isn’t the Same for Everybody

August 31, 2012August 31, 2012 horvath Leave a comment

This past month Coloradans took special notice when the unemployment rate was announced because it matched the U.S. rate. The July seasonally adjusted rate for both was 8.3%.

In July, the Bureau of Labor Statistics reported that there were 13.4 million unemployed Americans, based on the non-seasonally adjusted rate (NAR) of 8.6%. This is slightly higher than the more frequently publicized seasonally adjusted rate (SAR) of 8.3%.

A closer look at the data shows distinct differences based on demographics and geography.

Gender
• 6.9 million men unemployed with a NAR of 8.2%.
• 6.5 million women unemployed with a NAR of 9.0%.

Race
• .5 million unemployed Asians with a NAR of 6.2%.
• 9.5 million unemployed Whites with a NAR of 7.6%.
• 2.8 million unemployed African-Americans with a NAR of 15.0%.

Ethnic Origins
• 2.5 million unemployed Latinos with a NAR of 10.3%.

Age Groups
• 4.0 million unemployed, 16-24 years old, with a NAR of 17.1%.
• 2.8 million unemployed, 25-34 years old, with a NAR of 8.3%.
• 2.2 million unemployed, 35-44 years old, with a NAR of 6.8%.
• 2.3 million unemployed, 45-54 years old, with a NAR of 6.6%.
• 1.5 million unemployed, 55-64 years old, with a NAR of 6.3%.
• .5 million unemployed, 65+ years old, with a NAR of 7.2%.

Marital Status
• 4.4 million unemployed married people, spouse present with a NAR of 5.4%.
Despite a steady recovery, there are segments of the population that have not found jobs.

Geographic rates are available for Colorado. In July both the NAR and SAR were coincidently 8.3%.

Metropolitan Statistical Areas (MSAs)
• The NARs for the Boulder and Fort Collins MSAs were less than 8.3%
• The NAR for the Denver-Aurora-Broomfield MSA was 8.3%.
• The NARs for the Pueblo, Colorado Springs, Greeley, and Grand Junction MSAs were greater than 8.3%.

Counties (Most recent data is June 2012).
• Colorado has 64 counties, 25 have NARs greater than the state average and 1 has a NAR equal to the state rate.

• Seventeen of Colorado’s counties are part of the MSAs. Seven of the 17 have NARs greater than the state average.
• Of the 47 rural counties, 28 have NARs less than the state average, 1 has a rate equal to the state NAR, and 18 have NARs below the state average.
• Most of the rural counties with higher than average unemployment rates are on the Western Slope or the south/southwest part of the state.

Cities with populations greater than 25,000 people (Most recent data is June 2012).
• The NARs for Arvada, Boulder, Broomfield, Castle Rock, Fort Collins, Lafayette, Longmont, Loveland, Parker, and Westminster were less than 8.3%
• The NAR for Lakewood was 8.3%.
• The NARs for Aurora, Brighton, Centennial, Colorado Springs, Commerce City, Denver, Englewood, Fountain, Grand Junction, Greeley, Northglenn, Pueblo, Thornton, and Wheat Ridge.

While the state has been steadily adding jobs for two years, there are clearly parts of the state where the economy has not recovered.

For additional information on the Colorado go to https://cber.co/CBEReconomy.html.

Colorado Unemployment Rate Up for Fourth Month in a Row

August 20, 2012August 20, 2012 horvath Leave a comment

The Colorado unemployment rate rose for the fourth consecutive month and reached 8.3%. While the BLS indicated that this increase was not statistically significant, it is certainly significant to incumbents seeking re-election in November.

The unemployment rate is a metric that the public pays attention to. They view it as a sign that the economy is not improving – as promised. Specifically, more than 225,000 people are unemployed in Colorado. The never-ending talk about the fiscal cliff, additional easing by the Federal Reserve, and other doom and gloom projections add to the concerns of the electorate and the woes of incumbents.
The increase to 8.3% is significant for another reason. This is the second consecutive month that the state unemployment rate has matched the U.S. Over the past decade, the Colorado rate has often been a half to a full point lower than the U.S. rate. Seldom has Colorado’s rate been equal to or higher than the nation.

The basic reason for the rise in the rate is that the size of the labor pool increased. In other words, a greater number of people began looking for jobs. Even though the public and private sector have been adding jobs for the past two years, they aren’t being added fast enough to absorb all of the interested workers.

On a positive note, initial job claims are declining. That means there are fewer layoffs.

Continuing claims are also trending downwards – ever so slowly. That means people are either finding work or their benefits have expired. The former is a positive sign, while the latter is not.

The most recent data release shows that after seven months, an average of 40,000 jobs have been added, or about 3,300 jobs per month. Two factors could cause 2012 employment to be less than 2011 (Last year the state added 33,000 jobs).

BLS periodically and systematically revises the unemployment and employment data. Revisions to the data could push the 2012 total downward (an upward revision is unlikely).

As well, there could be a downturn in employment. If employment drops to a monthly average of 23,000 for the last five months then the annual total would be 33,000, or the same as 2011.

The good news is that gross job losses appear have declined, there has been a slight increase in gross job gains, and more people are looking for work. While this scenario is not ideal, it is much better than having a rise in the unemployment rate caused by a drop off in gross job gains and an uptick in gross job losses.

Employment Numbers Drive DJIA up by 217 Points

August 7, 2012August 7, 2012 horvath Leave a comment

On August 3rd the Bureau of Labor Statistics reported that the U.S. added 163,000 jobs for the month of July. Employment for May was revised upwards for the second consecutive month to 87,000; however, June was lowered from 80,000 to 64,000. The news drove the Dow Jones Industrial Average up by 217 points.

Through the first seven months of this year, the nation added about 151,000 jobs a month. This compares to a monthly average of 153,000 jobs for the first seven months of 2011. Since the end of the recession the U.S. has added net jobs in 25 months and lost net jobs in 12 months. Employment growth is consistently weak, but since October 2010 it has been consistently positive. About 3.1 million jobs have been added since the end of the recession.

About one-third of the monthly sector employment gains were in the Professional and Business Services, lead by the Temporary Help Services and Computer Systems Design sectors. Jobs were also added in health care, leisure and hospitality, manufacturing, and wholesale trade. Other major sectors were relatively flat.

On an upbeat note, the Conference Board is projecting stronger growth in the second half of 2012. Annual real output growth for the year will be about 1.9%.

Likewise, the USA TODAY/IHS Global Insight Economic Outlook Index calls for Real GDP growth to reach 2% in the latter part of the second half of the year. This index tracks 11 leading and financial indicators. The following four indicators increased – hours worked, real capital goods orders, the real money supply and light-vehicle sales.

On average, Colorado nonfarm employment is about 1.72% of the U.S. total. If Colorado grows at the same pace as the U.S. the upcoming August press release will reflect a gain of about 2,900 jobs.

May Employment Numbers Disappointing, but not Surprising

June 2, 2012June 2, 2012 horvath Leave a comment

Several months after the 2007 recession began, some economists projected the economy would not recover until 2014. Six years sounded like it was much too long, particularly since the country had just gotten back on its feet from the 4 1/2 years of the 2001 recession and recovery. The most recent announcement by the Bureau of Labor Statistics (BLS) illustrates how the ongoing lack of primary job creation has caused the recovery to be so long and painful.

On June 1, the monthly BLS press release stated, “Nonfarm payroll employment changed little in May (+69,000). Employment increased in health care, transportation and warehousing, and wholesale trade but declined in construction. Employment was little changed in most other major industries.”

If Colorado is growing at the same pace as the U.S., the BLS will announce, later in the month, that the state will post a gain of about 1,200 jobs in April. (Colorado nonfarm employment is about 1.72% of the U.S. total.)

When this release hit the newswires, the equity markets tanked. In addition to the weak job gains, investors were worried about Greece’s debt problems, U.S. debt, the recession in parts of Europe, the slowdown in the Chinese and Indian economies, and much more. While these are clearly legitimate concerns, the decline in employment should not have come as a surprise. Past economic forecasts prepared by The Conference Board foretold of the pending dip.

TCB has forecasted that 2012 output will be at its lowest level in Q2. It stands to reason that subpar output will be accompanied by weak employment growth for April, May, and June. On a positive note, output (consumption, housing starts, and capital spending) is projected to improve slightly in Q3 and Q4. The average rate of output growth for the year will be about 2.2%. This suggests that employment will improve along with the increased output. Next year, 2013, will only be slightly better. The good news is that the trends are in a positive direction.

The recovery will continue to be painfully slow for a number of reasons:
• According to the TCB, output in advanced economies is growing at a rate of 1.3% – worse than the U.S. The emerging economies have stronger growth, 5.6%. Colorado companies that export agricultural and manufactured goods may have greater opportunities in emerging countries.
• The number of federal workers continues to decline.
• The intent of the stimulus funding was to create private sector jobs. Those jobs were supposed to kick in when stimulus funding was reduced. Unfortunately, too few private sector jobs have been created and funding is being diminished. This makes the stimulus efforts appear to be ineffective.
• Although revenues have improved for many state and local governments, their budgets remain tight. In Colorado, state employment is flat and local governments have fewer jobs than one year ago.
• Overall inflation has been kept in check; however, energy prices, and the prices of other commodities, are noticeably higher than when the recession started.
• The construction and housing markets have not rebounded as quickly as anticipated. Colorado construction employment is at the same level as it was in the mid-1990s, although it is finally trending upward.
• Companies have been able to meet their sales targets by investing in capital rather than labor. Productivity gains have allowed companies to maintain a competitive position without adding workers. At some point in the next 18-24 months this will change and companies may be forced to add workers.

The latest job numbers are disappointing, but not surprising. There will be slight improvement in the second half of the year, with continued volatility in 2013.

Continued patience is required. At the earliest, 2014 will be the year when stronger growth can be expected.

BLS reports 33,000 Colorado jobs added in 2011

March 28, 2012March 28, 2012 horvath Leave a comment

The Bureau of Labor Statistics recently released its benchmark revisions for 2011 that show Colorado added 33,000 jobs in 2011. The updated total is nearly double the projected job growth of the monthly data presented throughout the year.

After peaking in 2008, approximately 150,000 jobs were shed in 2009 and 2010. Employment declines were so severe that total employment dropped below the 2001 peak. Finally, in 2011, Colorado employment again surpassed the high point in 2001.

If Colorado employment increases by about 1.7% in 2012 and 1.9% – 2.2% for the 2 years after that, it will reach the 2008 peak in 2014. In other words, it will take six years to return to the 2008 peak.
By comparison, it took 4½ years for employment to return to the 2001 peak after jobs losses associated with the 2001 recession. (Some economists are saying the full recovery will return to peak just in time for the next cyclical downturn).

U.S. Employment Situation Improves

January 22, 2012January 22, 2012 horvath Leave a comment

The Bureau of Labor Statistics recently announced that wage and salary payrolls added 200,000 workers in December. This means that about 133,000 net jobs were added on a monthly basis in 2011. There was marked improvement as the year progressed, as about 143,000 jobs were added a month for the last 6 months of the year. Sectors adding jobs were transportation and warehousing, retail trade, manufacturing, health care, and the extractive industries.

This rate of growth has been sufficient to gradually reduce the unemployment rate, which reached 8.5% in December. It is necessary to add about 225,000 jobs a month on a sustained basis to lower unemployment significantly.

There are about 13.1 million unemployed workers. Most likely that number understates the severity of the situation as it does not include discouraged workers or those who did not want to deal with the hassles of seeking unemployment.

It is important to note that 5.6 million have been without work for 27 months. (Keep in mind the total number of unemployed people in January of 2001 was 6.0 million people).

The jobless rates for men (8.0%) and women (7.9%) are similar, while teenagers come in at 23.1%. The Asian population has the lowest unemployment rate at 6.8%, followed closely by whites at 7.5%. Hispanics have a jobless rate of 11.0% and blacks register 15.8%.

The Q4 preliminary Real GDP report is scheduled to be released in the latter part of January and is expected to be in the 2.5% to 3.0% range, a marked increase from the first part of the year. The combination of improved output and the increase in the number of jobs added bodes well (but not great) for 2012.

U.S. Employment Situation – The Good, The Bad, The Ugly

July 12, 2011May 31, 2014 horvath Leave a comment

The recent labor report from the BLS brings back memories of the Clint Eastwood classic, “The Good, the Bad, and the Ugly.”

The Good – In February, March, and April an average of 220,000 jobs were added each month.
The Bad – In May the original estimate was that 54,000 jobs had been added. It was hoped that the downward trend would simply be a bump in the road.
The Ugly – The number of jobs created for May was revised downward to 25,000 with an addition of 18,000 in June.

These are not the kind of job gains that economic recoveries are built on. It is estimated that 100,000 to 125,000 jobs must be added each month to prevent unemployment from rising. If you account for the number of older workers who have remained in the workforce, that number might be bumped to 150,000 to 175,000. It is necessary to add between 200,000 and 225,000 jobs each month, on a sustained basis, to lower the unemployment rate.

The private sector posted gains of 57,000, while budget strapped governments reduced their payrolls by 39,000. The net is +18,000 employees.

The financial sector declined by 15,000 followed by construction at 9,000 workers. In addition, the temporary help services sector shed 12,000 workers. The sector, which is often considered a harbinger of broader hiring, declined for the third consecutive month.

On the positive side of the ledger the most significant sector gains were as follows:
• Leisure and hospitality 34,000 employees
• Health care and social assistance 17,400 employees
• Professional and business services 12,000 employees
• Wholesale trade   7,100 employees
• Manufacturing   6,000 employees
• Retail trade   5,200 employees
• Other services   5,000 employees
• Transportation and warehousing   3,600 employees.
Note: Not all sectors are included in the above overview.

While there is optimism for improved economic activity in the second half of the year, the reports cast doubts about job expectations. Employment growth appears to be nothing more than a necessary evil in the new economy that is driven by technology, globalization, a housing bust, and struggling financial markets.

Clint Eastwood, where are you when the country need you the most?

Third Consecutive Month of 200,000+ Job Growth

May 7, 2011May 31, 2014 horvath Leave a comment

On Friday (5/6/11), the Bureau of Labor Statistics announced the U.S. had added 244,000 jobs in April (2011), the third consecutive month for the U.S. to add at least 200,000 net jobs. Private sector jobs were added at the highest rate in 5 years.

The Professional and Business Services sector added about 51,000 new workers, followed by tourism (46,000), and health care (37,000). Manufacturing posted gains of 29,000 employees.

As expected the largest loser was government, primarily local governments. Sector employment dropped off by 24,000 workers.

The nation has regained 1.3 million jobs in the past year; however payrolls have about 7 million fewer workers than at the pre-recession peak. Despite this improvement, the recovery continues to be painful for a society that thrives off instant gratification.

The current momentum will continue if inflation remains in check, the double dip in the construction sector and housing markets is short-lived, and net job gains continue to average at least 200,000 jobs per month. It will take about 3 more years to recover all jobs at that rate of growth.

In two weeks the Colorado Office of Labor Market Information will release its preliminary employment update for April. Positive, but less than robust job gains are expected, with PBS, Tourism, Health Care, and Higher Education leading the way.