Job Growth Is Well Under Expectations Yet Again

Nonfarm Payrolls 2021-05A

Second Big Miss

For April, economists predicting 998,000 jobs, and 55,000 manufacturing jobs. The BLS reported 266,000 jobs with a loss of 18,000 manufacturing jobs. 

For May, economists predicted 650,000 jobs the same as the ADP predicted. The BLS reported 559,000 jobs. That's not a bad number in isolation, but in light of stimulus, predictions, and declining work hours, it's another miss.

BLS Jobs Statistics at a Glance

Details from the monthly BLS Employment Report.

  • Nonfarm Payroll: +669,000 to 144,894,000 - Establishment Survey
  • Employment: +444,000 to 151,620,000- Household Survey
  • Unemployment: -496,000 to 9,316,000- Household Survey
  • Baseline Unemployment Rate: -0.3 to 5.8% - Household Survey
  • U-6 unemployment: -0.3 to 10.4% - Household Survey
  • Civilian Non-institutional Population: +107,000 to 261,210,000
  • Civilian Labor Force: -53,000 to 160,935,000 - Household Survey
  • Not in Labor Force: +160,000 to 100,275,000 - Household Survey
  • Participation Rate: -0.1 to 61.6% - Household Survey

BLS Error Rate

Since March 2020, BLS has published an estimate of what the unemployment rate might have been had misclassified workers been included among the unemployed. Repeating this same approach, the seasonally adjusted unemployment rate in May 2021 would have been 0.3 percentage point higher than reported. However, this represents the upper bound of our estimate of misclassification and probably overstates the size of the misclassification error.

I strongly question the accuracy of the BLS assertion that 0.3% is the high end of their error rate.

Job Revisions

  • The change in total nonfarm payroll employment for March was revised up by 15,000, from +770,000 to +785,000
  • The change for April was revised up by 12,000, from +266,000 to
  • +278,000. 
  • With these revisions, employment in March and April combined is 27,000 higher than previously reported.

Part-Time Jobs

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