Economic News

[nycfan]

 

[UNCMSinLS]

... and the "respected" mainstream slurpers continue to slurp up the nonsense.

 

[UNCMSinLS]

Oops. Guess Trump's Bureau slipped up on getting that rate cut. Economics. Shmeeconomics. We'll just fire Powell and get our cut anyway.

 

[nycfan]

 

[UNCatTech]

Wow, I made $5 an hour plus tips when I delivered for the hut. Of course considering inflation i probably had greater spending power.

 

[superrific]

All right. I've done a deep dive into the job numbers here, because they didn't make sense. Why would state and local government + health care be carrying the jobs report? And here's what I've found out:

1. I thought the health care sector would be down because of the knock on effects from the NIH cuts. I can't find any evidence to support that. So I guess the 40K there is a legit number. Of course, this type of workforce gain is a double edged sword, in that it creates temporary employment but there's no investment value, but regardless.

Now, hospitals are the biggest category of hiring. Let's see what will happen with medicaid cuts. These job gains could be illusory. But this line checks out.

2. "Education" gains seem to be illusory. They are all functions of seasonal adjustments. Education employment actually **WENT DOWN** but by less than it usually does in the summer. So the seasonal adjustment made it seem like a gain. I don't know why jobs would be higher in education this summer as opposed to last.

We have a lot of educators here. Any ideas? I mean, federal assistance is set to drop considerably. Why would they keep people employed?

3. The next biggest line item is "Individual and family services." This is where I drilled deeper and found what's happening here. The funding available under a federal statute called FFPSA has been untouched -- unlike most federal assistance programs. So there's more money there. And FFPSA money is mostly about placement in foster care and follow-up checks.

This increase is almost surely related to deportations. They are deporting parents, leaving kids, and thus way more foster care services will be needed. I am guessing that the funding for these organizations is renewed annually, probably in June? This suggests to me that states and localities are either having a surge in orphans or are expecting ones.

So this category of job increase should be viewed as a negative, not a positive. It's almost surely not going to continue.

 

[superrific]

So bottom line: most of the gains in this job report are likely one-time effects. I would not expect to see those seasonal gains in education show up sequentially, so you can take most of that number right out of the July jobs report. I have no idea what will happen with FFPSA but obviously this category of jobs is not making anyone richer.

I predict August is going to prove to be a whipsaw with most of these job gains in education evaporating.

That said, I don't know if there are effects on the flip side -- i.e. are there decreases in other categories that reflect unusual patterns relative to seasonal adjustments? There are no big categories that I can see, but there are a lot of line items so drips and drops coming in could make a difference.

Still, I think this is a one-off jobs report. Yes, I want it to be, so my reasoning is not without motivation, but I do try to be as objective as possible.

 

[nycfan]

 

[gregh1]

I sold a little bit in March... and never got back in.

 

[superrific]

If I have to say so myself, I think I've done some pretty good economic analysis/sleuthing today. Going to give myself a pat on the back and work on other things now.

 

[Duke Mu]

All right. I've done a deep dive into the job numbers here, because they didn't make sense. Why would state and local government + health care be carrying the jobs report? And here's what I've found out:

1. I thought the health care sector would be down because of the knock on effects from the NIH cuts. I can't find any evidence to support that. So I guess the 40K there is a legit number. Of course, this type of workforce gain is a double edged sword, in that it creates temporary employment but there's no investment value, but regardless.

Now, hospitals are the biggest category of hiring. Let's see what will happen with medicaid cuts. These job gains could be illusory. But this line checks out.

2. "Education" gains seem to be illusory. They are all functions of seasonal adjustments. Education employment actually **WENT DOWN** but by less than it usually does in the summer. So the seasonal adjustment made it seem like a gain. I don't know why jobs would be higher in education this summer as opposed to last.

We have a lot of educators here. Any ideas? I mean, federal assistance is set to drop considerably. Why would they keep people employed?

3. The next biggest line item is "Individual and family services." This is where I drilled deeper and found what's happening here. The funding available under a federal statute called FFPSA has been untouched -- unlike most federal assistance programs. So there's more money there. And FFPSA money is mostly about placement in foster care and follow-up checks.

This increase is almost surely related to deportations. They are deporting parents, leaving kids, and thus way more foster care services will be needed. I am guessing that the funding for these organizations is renewed annually, probably in June? This suggests to me that states and localities are either having a surge in orphans or are expecting ones.

So this category of job increase should be viewed as a negative, not a positive. It's almost surely not going to continue.

The private sector lost 30,000 jobs. Gains were apparently temporary positions in government, healthcare, and hospitality/travel. DOGE incompetence whiplash.

US adds 147,000 jobs in June, surpassing expectations amid Trump trade war

Economists anticipated drop, but 8,000 new positions were added in June compared with May, with unemployment rate down to 4.1%

www.theguardian.com

New data had shown employers showing signs of hesitancy. The payroll firm ADP found that the private sector lost 33,000 jobs in June, far below the 100,000 increase that was expected, and the first decrease since March 2023.

The dip in job openings does not necessarily mean companies are laying off more workers; rather, they are creating fewer new positions.

 

[superrific]

The private sector lost 30,000 jobs. Gains were apparently temporary positions in government, healthcare, and hospitality/travel. DOGE incompetence whiplash.

US adds 147,000 jobs in June, surpassing expectations amid Trump trade war

Economists anticipated drop, but 8,000 new positions were added in June compared with May, with unemployment rate down to 4.1%

www.theguardian.com

New data had shown employers showing signs of hesitancy. The payroll firm ADP found that the private sector lost 33,000 jobs in June, far below the 100,000 increase that was expected, and the first decrease since March 2023.

The dip in job openings does not necessarily mean companies are laying off more workers; rather, they are creating fewer new positions.

The ADP report is not the same as the BLS report. The BLS report reported 74K gains in the private sector. They were concentrated in leisure/hospitality and health/private education.

I have no idea why leisure/hospitality jobs would be up in light of the decline in international travel to the US. Actually, I have one idea: the Gold Cup and Club World Cup. If so, expect that number to drop this summer.

There could also be job creation from rebuilding from wildfires and natural disasters last year.

 

[nycfan]

UPS Offers Buyouts to Drivers, a First in Its 117-Year History​

Company is cutting costs because of flat parcel volumes, rising labor costs and a long stock-price slide​

“…
UPS decided to offer buyouts to its drivers because the company is navigating “an unprecedented business landscape” and reorganizing its network, a company spokesman said.

UPS drivers are among the highest-paid delivery drivers in the U.S. The average full-time driver will earn around $170,000 annually, including benefits, by the end of a five-year contract that UPS signed with the Teamsters in 2023. Many investors thought the company conceded too much ground to the union. UPS shares are down about 45% since July 24, 2023, the day before the company and the union reached their agreement.

UPS reported a 3.5% decline in the average daily package volume in the U.S. for the first quarter of this year, and has said it would deliver fewer packages for its largest customer, Amazon.com, because they aren’t profitable enough. In April, UPS said it would cut 20,000 operational jobs this year.

The Teamsters said the proposed buyout offers are far less than what rank-and-file members could make over the remainder of the current contract.…”

https://www.wsj.com/business/logistics/ups-driver-buyout-first-117-years-f3be772c?mod=mhp