Is Full Time Employment a Trend or Noise? Let’s Compare Today to the Great Recession – Mish Talk

November 5, 2022

Payrolls vs Employment Since March 2022

Employment fell by 328,000 in October.

Full time employment is down 490,000 since March and down by 572,000 since May!

Some say employment is noise. Let’s tune into the discussion.

Household Survey vs Establishment Survey

In Search of Noise

Trend or Noise?

Watch the Turns

Mish: “As for misleading – I suggest the household survey and full time employment may be the one to watch at turns, not the establishment survey.“

Great Recession Flashback

Payroll and employment data from the BLS, chart by Mish

Great Recession Synopsis

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In a span of 7 months, jobs fell by 249,000.

In the same span, full time employment fell by 1,167,000.

Current Setup

Since March of 2022, payrolls are up about 2.5 million but full time employment is down by 490,000.

All of the employment rise (and then some) since March is part-time employment. But that’s a mere 150,000 in seven months since March.

Looking Ahead

Due to tech, financial, and housing losses, I expect the next jobs report will be even weaker, possibly (if not likely) job losses.

Perhaps that’s the market focus. Who knows? I don’t and no one else does either.

Noise Watch vs Reality Watch

Looking for trend changes ahead of recessions? Watch full time employment, not jobs.
A 7-month employment trend in a clearly weakening economy is unlikely to be noise.
Putting meanings on day-to-day market events is noise, much if not most of the time.