What The Heck Happened To Employment (-18K) Vs. Jobs (+850K) In June?

Nonfarm Payrolls 2021-06

The BLS says nonfarm payrolls rose by a seasonally-adjusted 850,000 in June. Leisure and hospitality led the way, expanding by 343,000 jobs. Government added another 188,000 jobs. 

For more details and discussion, please see Jobs Expand by 850,000 with 188,000 of Them Government, But Employment Drops!

The above jobs numbers are from the Establishment Survey. Employment numbers are from a Household Survey.

Household Survey vs. Payroll Survey

The payroll survey (sometimes called the establishment survey) is the headline jobs number, generally released the first Friday of every month. It is based on employer reporting.

The household survey is a phone survey conducted by the BLS. It measures unemployment and many other factors.

If you work one hour, you are employed. If you don’t have a job and fail to look for one, you are not considered unemployed, rather, you drop out of the labor force.

Looking for jobs on Monster does not count as “looking for a job”. You need an actual interview or send out a resume. 

Household Survey Employment by Age Group

Employment May-June 2021 In Thousands

BLS Process

The BLS takes raw numbers (unadjusted) and applies seasonal adjustments. The BLS reports the seasonal adjustments for some age groups but not others. 

Typically, when comparing month-to-month totals, one uses seasonally adjusted data. To understand why, think of kids in school or employment that rises in November and December then falls in January after Christmas.

But we do not have that data. It's not as important for older age groups because school isn't as big a factor although it does affect teachers. 

Surprising Drops

Seasonally adjusted, employment in age group 16-19 fell by 228,000. It fell by 122,000 in age group 25-34. 

Add it all up it comes to -221,000 but reported as -18,000. Part of that discrepancy stems from a combination of using a mix of seasonally adjusted and unadjusted number (but I only have what the BLS provides). 

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