There’s no new significant news until Wednesday, so let’s catch up graphically with a few important items from Friday’s employment report for January.

As I wrote then, probably the most important developments weren’t in the monthly numbers, but rather the annual revisions to both the Establishment and Household Surveys. 

For background, recall that the monthly report is a survey. But once every quarter, with unfortunately about a six month lag, an actual census of almost 100% of all employers is published, based on their tax reporting. This is called the QCEW. And through Q2 of last year, it indicated that the Establishment Survey had been too optimistic by over half a million jobs. That was resolved on Friday with a downward revision of 610,000 jobs over the past 12+ months.

On the other hand, all last year I was writing that the Household Survey was “frankly recessionary,” showing almost no growth YoY. But it appeared via ata from the Congressional Budget Office, that the survey had missed millions immigrants in the years since tha pandemic. That too was largely resolved on Friday, with the addition of over 2,200,000 to the number of people employed.

The downward revisions in the Employment Survey, and the upward revision in the Household Survey, completely resolved the discrepancy between the two:

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There were a few other trends of note, all from the Establishment Survey.

I’ve noted in the past several months how goods-producing employment has stalled. The are two separate and contradictory trends playing out here. The first is that manufacturing employment has fallen by about -140,000 in the past two years. Up until the 1980s, this would absolutely be recessionary. But no more, as manufacturing employment is too small a share of the total. And in the past two years, it has been completely balanced by growth of over 370,000 in construction jobs:

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What has been particularly surprising is the continued growth in residential construction jobs, despite the downturn in virtually every other metric in that sector:

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If the goods producing sector as a whole has turned flat, that means that on net all the growth is coming from service providing jobs. But not all such jobs. In particular, as I have been highlighting for over a year, professional and business employment, which tends to be higher paying jobs, has seen a decline of roughly -250,000 jobs in the past 18 months. But the remainder of the services sector has added almost 4,000,000 jobs:

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A fair amount of that growth has come from the provision of health care, which has seen employment grow at a steady 3% YoY clip:

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The net effect of all these cross currents - at the moment - is slow but steady employment growth. I continue to focus particularly on the construction sector, where I just do not see residential construction employment continuing to levitate when the number of houses under construction is down over -15% from its recent peak.

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