Good News on Employment
By David Henderson
The latest data (for January) on employment and unemployment came out this morning and the news is good.
The biggest news:
The labor force participation rate, which has been the sick puppy this century, rose by 0.1 percentage point, from 63.1 percent to 63.2 percent.
The employment to population ratio rose by 0.1 percentage point, from 60.6 percent to 60.7 percent.
The overall unemployment rate rose, however, from 3.9 percent to 4.0 percent. In most subcategories, by age, race, gender, etc., the unemployment rate rose slightly or stayed the same.
So with a higher unemployment rate, why do I say that the news is good? It’s because of the first two pieces of news above, on labor force participation rate and on the employment to population ratio.
The above data are all from the BLS household data, linked above.
On the establishment data side, which looks at employers, the number of jobs rose by a hefty 304,000, which is well above most people’s predictions. The odds that a correction of the data next month (such corrections always happen) will still show that the number of jobs gained is well above most people’s predictions.