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The Jobs Market Is Starting to Fall Apart​

Even if Thursday’s jobs report comes in strong, a look behind the headline number tells a different story​


🎁—> https://www.wsj.com/economy/jobs/jo...6?st=BAsbZ5&reflink=desktopwebshare_permalink

“The U.S. has been adding jobs at a respectable clip, though the pace has been slowing. Economists expect that the Labor Department’s monthly jobs report on Thursday will show that the economy added 110,000 jobs in June.

This year through May, the U.S. has added an average of 124,000 jobs a month. That is down from last year’s average of 168,000 a month—a reflection in part of how stop-start tariffs, government layoffs and an immigration crackdown could be catching up to the job market. More fundamentally, slow population growth and an aging workforce make it harder for the U.S. to add jobs like it did in the past.

… People who have jobs are keeping them, but those who want jobs are having a tough time finding work. That includes recent high-school and college graduates, people who are back on the job hunt after an absence, and those who have been fired.

… For January through April, the Labor Department has so far revised down the monthly employment gains by an average of 55,000 jobs. March went from a headline of 228,000 jobs added when it was first announced, to 185,000 when it was first revised, to 120,000 when it was revised again….

[QCEW = US Government Quarterly Census of Employment and Wages]

IMG_7775.jpeg

… The survey of businesses—what economists call the establishment survey—shows that the U.S. added about 1.7 million jobs over the 12 months ended in May. But comparable numbers from the household survey show a smaller gain of about 1 million jobs.

To be fair, economists usually prefer the establishment survey for counting jobs. That, after all, is what it is designed to do. Still, the household survey is another yellow flag. …”
 
nycfan said:

The Jobs Market Is Starting to Fall Apart​

Even if Thursday’s jobs report comes in strong, a look behind the headline number tells a different story​


🎁—> https://www.wsj.com/economy/jobs/jo...6?st=BAsbZ5&reflink=desktopwebshare_permalink

“The U.S. has been adding jobs at a respectable clip, though the pace has been slowing. Economists expect that the Labor Department’s monthly jobs report on Thursday will show that the economy added 110,000 jobs in June.

This year through May, the U.S. has added an average of 124,000 jobs a month. That is down from last year’s average of 168,000 a month—a reflection in part of how stop-start tariffs, government layoffs and an immigration crackdown could be catching up to the job market. More fundamentally, slow population growth and an aging workforce make it harder for the U.S. to add jobs like it did in the past.

… People who have jobs are keeping them, but those who want jobs are having a tough time finding work. That includes recent high-school and college graduates, people who are back on the job hunt after an absence, and those who have been fired.

… For January through April, the Labor Department has so far revised down the monthly employment gains by an average of 55,000 jobs. March went from a headline of 228,000 jobs added when it was first announced, to 185,000 when it was first revised, to 120,000 when it was revised again….

[QCEW = US Government Quarterly Census of Employment and Wages]

IMG_7775.jpeg

… The survey of businesses—what economists call the establishment survey—shows that the U.S. added about 1.7 million jobs over the 12 months ended in May. But comparable numbers from the household survey show a smaller gain of about 1 million jobs.

To be fair, economists usually prefer the establishment survey for counting jobs. That, after all, is what it is designed to do. Still, the household survey is another yellow flag. …”
Click to expand...
IMG_7776.jpeg
 
Oh, this "we can't create new jobs" bullshit is just that -- bullshit. Actually, that's what I thought before running the numbers. The data suggests something a bit different.

3.9 million Americans graduated high school this year. It's been at least 3.7M every year since 2018.

In 1960, there were 4.2M births. According to actuarial tables, a bit less than 3/4 of the 1960 births are still alive. So that's about three million people, maybe 3.1. According to data, the labor force participation rates during prime years of people born in 1960 was about 85%. That's not how many are working today; that's how many were in the labor force at some point during their adult years. So 15% of people can't be working today because they never really had jobs. So that 3 million gets knocked down to about 2.6M. In other words, the upper limit on retirees is about 1.5M less than new labor force entrants.

College doesn't make a difference statistically, given that college attendance rates and high school graduation rates have not really moved in the last 8-10 years. So the number of people entering the workforce from college (whether graduate or dropout) is roughly the same as people going to college. Retirements are the same story: some people who turn 65 this year are already retired; some won't retire until a few years from now, and those numbers would be probably similar. If anything, the early retirements would likely outnumber the late retirements but this is probably a wash at the accuracy level of these calculations. And birth rates were similar in 1958, 1960 and 1962 so that isn't going to make much difference either.

So by my calculations, 18 year old Americans graduating high school this year outnumber retirees by 1.5M. That doesn't fully describe the effect on the job market, because of the possibility of non-retirement disappearance from labor force for people under 65, but whatever. Add back in immigrants who are turning 65, which I estimate at about 500-600K based on similar data and approaches, and subtract out the 50K or so emigrants to get a net workforce increase of about 1 million workers, maybe a little more.

So let's call it 100K per month. That's the no-change-to-full-employment number of jobs to be expected, which I guess is sort of what we're seeing. There are probably more ways of exiting the workforce than I know, so my estimate is likely low. Also, birth rates went down a lot between 1960 and 1967. The median retirement age is about 62, but I don't know about the skew. If the boomers retired slightly on the younger side -- for instance, as in the pandemic -- then my estimate would be too low because I would be overcounting retirements.

I'm not taking account of undocumented workers because they should wash out of the data, as they aren't really counted anyway.
 
nycfan said:
Click to expand...

Think it's a combo of a few things:

1. Boomers living in their own homes longer than previous generations
2. The population bomb which was millennials aging into ownership compared to the relatively small Gen X
3. Air BnB/ Verbo
 
superrific said:
The easiest explanation is population increased faster than housing.
Click to expand...
More than a little is real in terms of larger size, increased number of and more complex appliances , new energy technologies including solar and geothermal and a massive upgrade in data wiring and such.
 
superrific said:
The easiest explanation is population increased faster than housing.
Click to expand...
Some things go up in value faster than the price of inflation. Supply and demand is certainly the most logical explanation for that.

That chart shows that home values have roughly doubled the pace of inflation over the last 25 years.

But that is nothing compared to gold. In 2000 (in inflation adjusted dollars), gold traded at $503 an ounce. Today, it trades at $3,362.
 
altmin said:
Think it's a combo of a few things:

1. Boomers living in their own homes longer than previous generations
2. The population bomb which was millennials aging into ownership compared to the relatively small Gen X
3. Air BnB/ Verbo
Click to expand...
Perhaps related to #3, PE and RE investment groups buying, improving and flipping houses.
 
altmin said:
Think it's a combo of a few things:

1. Boomers living in their own homes longer than previous generations
2. The population bomb which was millennials aging into ownership compared to the relatively small Gen X
3. Air BnB/ Verbo
Click to expand...
There are also still lingering supply effects from the housing crash and covid.
And interest rates.
Maybe also the private equity increased ownership.
 
Calheel said:
Some things go up in value faster than the price of inflation. Supply and demand is certainly the most logical explanation for that.

That chart shows that home values have roughly doubled the pace of inflation over the last 25 years.

But that is nothing compared to gold. In 2000 (in inflation adjusted dollars), gold traded at $503 an ounce. Today, it trades at $3,362.
Click to expand...
Yea, but that's because after the global apocalypse the only thing of value to our dystopian overloads will be gold. Not food, not water, not energy, but the shiny metal, gold.
 
altmin said:
Think it's a combo of a few things:

1. Boomers living in their own homes longer than previous generations
2. The population bomb which was millennials aging into ownership compared to the relatively small Gen X
3. Air BnB/ Verbo
Click to expand...
Whenever I think I've got it figured out I watch Levon Helm in this clip from the shooter movie.
 
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