Will this Remarkable Jobs Report Take the Peloton Ad Out of the News Cycle?

Best November "Ever"

The Monthly Employment Situation Report is a market mover. The report is created using two different data sets: the Current Population Survey (CPS) jobs and unemployment data and the Current Employment Statistics (CES) worker and wages data.

It was thought that we could record the addition of another 400,000 private sector workers this month.  The seasonal factors meant that we could have  reported the addition of 189,000 to 228,000 private sector workers this month.

We Added 504,000 non-seasonally adjusted private Sector workers this month. The non-seasonally adjusted Month to month CES data was pointing to a loss of workers in the Leisure and Hospitality (LAH) sector, the Other Services (OS) sector and the Construction Sector.  The largest growth rates for November workers were expected to be recorded with the Trade, Transportation, and Utilities (TTU,) Government, Education and Health Services (EHS,) Information Technology (IT,) and Professional And Business Services (PBS) sectors. November to November growth was expected in all sectors. The largest November to November growth was expected to be recorded in Mining and Logging (M/L,) Construction, PBS, EHS, and LAH. Manufacturing was also expected to pop here, as well. 

We added 266,000 seasonally adjusted Non-Farm Payroll Workers. We added 254,000 SA Private Sector Workers. The SA NFP was revised up 41,000 for October so the headline could have been +307,000. The SA Private Sector data for October was revised up 48,000 so that number could have been +302,000

We had our largest October to November Growth Rate since 1979 at 0.39%.Our Second Lowest November Seasonal Factor, had we. The lower the seasonal factor the lower that the seasonally adjusted CES data is reported. If we had the same seasonal factor that was used during former President Obama's final November in office then we would have had this number reported at 351,000 workers added - private sector workers. October than last reported. If you add 48,000 to 351,000 then you get a 399,000 headline number. This would have been comparable to November 1994. (Funny, that is what the histogram says it the data with which it should be compared.)

The Non-Seasonally Adjusted CES data recorded November to November Growth in all sectors except Mining and Logging.  The largest growth rates November to November were in TTU, IT, EHS,  Government and PBS. This is, in part, why the NFP spiked.

The Month to Month non-seasonally adjusted CES data was pointing to a loss of workers in the Leisure and Hospitality (LAH) sector, the Other Services (OS) sector and the Construction Sector.  We saw month to month contraction in M/L, Construction, LAH, OS, and Financial Services (FIRE.) The largest month to month gains were in TTU, IT, EHS, Manufacturing and PBS. The thing to remember here is that the overall trend for these four sectors look similar to the Manufacturing sector data. Manufacturing, Construction, Other Services and Leisure and Hospitality tend to dip during November.

What Manufacturing Job Slowdown? We have the most November Manufacturing Workers under President Trump this November. More Manufacturing have joined the economy under President Trump than Other Service workers, Financial Services workers,  Mining and Logging workers, or IT workers.  The Number of Manufacturing workers tends to spike during November and December.

Highest Level of November Manufacturing Jobs since November 2008. Manufacturing jobs have been slowing for decades, as is evidenced in the top line chart. We had just over 13 million manufacturing workers during November 2008. That number of workers dropped to 11.55 million the following November. We have been increasing in manufacturing workers since that time. The thing to remember is that during 2016 President Obama was wondering what magic wand Republican Candidate Trump had to bring back manufacturing jobs? Now former President Obama wants to take credit for President Trump's accomplishments.

The seasonally adjusted data was projecting growth in all sectors month to month and November to November except Mining and Logging. We saw month to month and November to November The largest month to month growth was in Information, manufacturing, EHS, and LAH. The Largest November to November growth was reported in IT, Manufacturing, EHS, LAH, and PBS. The last three are very important because these are three of the four sectors that have had the most Job Openings, Hires, Separations, and Fires with regard to the monthly JOLTS report. The October JOLTS Report will be released this week.

Wage Wins Across the board. The CES data includes data on worker and wage data by sectors. Wages have been setting current month records all year long. This was expected to continue. The questions asked in the forecast article were: Would wages rise in all sectors November to November? Would workers rise in all sectors? Would hours drop in some sectors as more workers are available to do the work? Wages rose 1.98% to 6.13%, depending upon the sector. The overall hourly wage growth was  3.08%.

Hours workers were up except for Manufacturing, TTU, and LAH. Manufacturing workers are still working overtime. Leisure and Hospitality workers already work the fewest hours. Hours grew the most in financial services and EHS.

Overall Wages rose by 4.54%. Mining and Logging saw total wages soar by 5.51% even though the number of workers dropped by 0.80% November to November. Total income rose faster than 5% in five different sectors.

We have a record level of November workers earning record November wages. Manufacturing, Construction and IT still lag behind their 2007 levels. All three are rising. The seasonal adjustments could not turn this smile into a frown.

It's the Economy.

 Reclaiming Common Sense