Three Pictures from the April Employment Situation

Revisions are downward (but getting smaller over time), the growth rate becomes less negative, but hours continue to decline rapidly.

Figure 1: Nonfarm payroll employment, seasonally adjusted, various releases. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M05). Source: BLS, employment situation, various releases, and St. Louis Fed FRED II.

One point mentioned in various accounts is the impact of temporary government employment associated with the 2010 Census. I take out government employment as tabulated in the employment outlook and calculate annualized growth rates (in log first differences):

Figure 2: Month-on-month nonfarm payroll employment growth, annualized (blue) and month-on-month nonfarm payroll employment minus government employment, annualized (red). NBER defined recession dates shaded gray (assuming recession has not ended by 2009M05). Growth rates calculated as first log differences. Source: BLS, employment situation via St. Louis Fed FRED II and authors calculations.

While the growth rate for nonfarm payroll (NFP) ex.-government is lower than that for overall NFP, both series show smaller decreases in April than in March.

Finally, note that aggregate hours in private industry continue to decline faster than employment. This difference is not completely accounted for by differences in composition (i.e., between total NFP and NFP minus government).

Figure 3: Log Nonfarm payroll employment (blue), log nonfarm payroll employment minus government employment (green), and log aggregate weekly hours in private industry (red), seasonally adjusted, normalized to 0 in 2007M12. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M05). Source: BLS, employment situation, February release, via St. Louis Fed FRED II, and author’s calculations.

In other words, hours worked are now over 7 percent (log terms) below 2007M12 levels, even though employment in private industry is only down a bit over 5 percent.

Three Pictures from the April Employment Situation

About Menzie Chinn 83 Articles

Affiliation: University of Wisconsin

Menzie Chinn is Professor of Public Affairs and Economics at the University of Wisconsin, Madison.

Visit: Econbrowser

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