If you look Closer at the Job Figures Posted on Friday, Full-Time Workers are Declining and have been for Two Straight Months
Is it just people looking to drill down the figures and spread doom?
The number one economic headline this week was that the July job numbers went up +528,000. However, people neglected to look at the seasonally adjusted breakdown which is as so:
Multiple Jobs: +92,000
The Unemployment rate went down to 3.5%, but the labor force participation rate also moved down as well to 62.1% from 62.2%. These figures imply that the drop is from people dropping out of the unemployment calculation. Discouraged workers were up to 424,000 in July vs. 364,000 in June.
This is also the second month in a row that the seasonally adjusted figures for full-time workers have declined. In June, they declined by 152,000. The percentage of the population employed has actually been decreasing since March.
Also, on Friday — when the job figures were released — the Fed announced consumer borrowing rose 10.5% in June after a rise of 6.3% in May. The revolving debt was also up 16% month over month. In total, non-housing-related debt grew in Q2 by the most since 2016. 233 million credit card accounts have been opened in Q2 within the United States, the most since 2008.
If the Fed were to take the headline numbers as a reason to raise rates even faster than expected, we will probably see more businesses laying off full-time workers. Politicians also may seem excited by the numbers, but they also don’t seem too bullish unless you’re looking for a part-time job in hospitality.
Some say the initial estimate took all of this into consideration. Part-time jobs are going up by a lot indicating that people are still spending and demanding labor. It’s hard to look at the job’s numbers and not be optimistic. Is it just people looking to drill down the figures and spread doom? Unemployment is very low given that we have had two consecutive quarters of GDP decline.