January Jobs Report - Strength in the CES Worker Data
Strength in CPS Jobs and Unemployment Data
The January Jobs report is marked by the situation that we will have very different Non-Seasonally Adjusted (NSA) data and Seasonally Adjusted Data story-lines. There are two data sets that go into the jobs report, or employment situation report, and they measure different things. The Current Population Survey (CPS) jobs and unemployment data and the Current Employment Statistics (CES) workers and wages data. Normally January brings seasonally adjusted and non-seasonally adjusted data revisions for the CES data and only revisions to the seasonal factors, and therefore only the seasonally adjusted data. We were advised months ago that the seasonally adjusted CES data was going to be revised down for the CES data with downward revisions for both the Private Sector CES data and the Non-Farm Payroll (NFP) CES data. We did not trim as many NSA CES workers as expected. How is President Trump doing when compared to former Presidents Reagan, Clinton, George W. Bush, and Obama?
The data looks quite remarkable. The headline Seasonally Adjusted CES worker data was up 206,000 private sector workers and 225,000 seasonally adjusted non-farm payroll positions. Unemployment, part of the CPS data set, was at it's lowest unemployment rate since January 1967. This was covered in "Jan. Jobs Report: Revisions and Remarkable Data." Seasonally adjusted workers were up in ten out of eleven sectors month to month. They were also up in tens sectors January to January. Every sector received a pay raise last year, January to January. This was covered in "Record January Wages and Worker Data." The thing is that the CES data is only half the story. The Current Population Survey (CPS) data and the CES data were out of sync last year. What happened this month?
President Trump has added 6.3 Million Full-time jobs during his first 36 months in office. January is traditionally a month where full-time jobs drop and part-time jobs rise, non-seasonally adjusted (NSA.) He has also added 103,000 part-time jobs and trimmed 1.6 million unemployed workers. The participation rate is up and the unemployment rate is at a 43 year low for the month of January.
Former President Clinton is the only other President, of the five, who trimmed unemployment and added full-time jobs. Former President Clinton only 3.5 million FT jobs, plus an additional 2.6 million PT jobs. This means that he only added 6.1 million total jobs during his first 36 months in office. He did start with a smaller economy.
Former Presidents Reagan, George W Bush, and Obama all saw unemployment rise during their first 36 months in office. Bush saw a loss of 199,000 FT jobs, the addition of 942,000 PT jobs, and unemployment spike d by 2.5 million people. President Obama saw FT jobs drop by 1.9 million, PT jobs rise by 1.4 million and unemployment remain 532,000 people higher than when he took office. There were a net 488,000 fewer jobs after his first 36 months in office. Former President Reagan saw FT jobs, PT jobs, and unemployment rise during his first 36 months in office. "The Gipper" added 1.7 million FT jobs, 1.4 million PT jobs, and added 1.0 million to the unemployment rolls.
There are some who say that it is unfair to compare President Trump's first 36 months with President Obama's first 36. The former President added 3.0 million full-time jobs during year 6, 2.6 million during year seven and another 2.6 million during year eight. He experienced a smaller drop during his final January in office than President Trump during his third January in office. It turns out that the former President added a net 7.0 million jobs during his final 36 months in office compared to 6.5 million for the current President. The "Jobs Mountains" for the four former Presidents can be found here.
Let's Compare participation rates and unemployment rates. Only President Reagan Clinton and Trump were able to reduce unemployment rates and increase their participation rates during the first 36 months in office. Former Presidents Bush and Obama saw participation decline even as unemployment rose. Former President Bush's participation rate was virtually unchanged, dipping from 65.78% to 65.75% while unemployment jumped from 4.65% to 6.26%. President Obama, on the other hand, saw participation drop from 65.37% to 63.35% and unemployment move higher from 8.48% to 8.82%.
There are those that who would say we need to compare the First and Final 36 months again. Okay. Former President Obama saw his Participation rate drop from January 2014 to January 2017 from 62.52% to 62.45% while his unemployment rate fell from 7.03% to 5.14%. President Trump during his first 36 months saw the unemployment rate fall from 5.14% to 3.98% while increasing his participation from 62.45% to 63.00%. It is easier to reduce your unemployment rate and decrease your participation rate than it is to reduce your unemployment rate and increase your participation rate. Unemployed workers are participants.
But what about the Current Employment Situation data? President Trump has seen all sectors add workers, non-seasonally adjusted, during his first 36 months in office. The largest gains, in number, have been recorded in EHS, PBS, LAH, Construction, and Manufacturing.
President Trump compares well with former President Clinton. All sectors of the economy are seeing elevated levels of workers under President Trump. The Graphics for the four former Presidents can be found here.
President Trump started with a larger job base, a larger worker base, than any of his predecessors, so as a percentage of the CPS jobs data and CES worker data some will argue that the accomplishments are not that remarkable. This President also started with a lower participation rate than any of these four predecessors and was fighting downward momentum.
It's the Economy.
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