Breaking Down the Jobs Disconnect
There is a big disconnect between the household survey and the establishment survey this month. The number of new jobs created of 114,000 from the establishment survey is vastly different from the increase in the number of people employed per the household survey of 873,000. The household survey is from a smaller sample size, so it has a larger error term around it, but even with that consideration, the difference is huge.
But it turns out some of jobs created in the household survey were in the "part time for economic reasons" category. In other words, part time jobs for people who would really like a full-time job. When you factor this in, the drop in the headline (U-3) unemployment rate to 7.8% from 8.1% is misleading when you look at the broad U-6 unemployment rate, which includes discouraged workers and the marginally attached, along with involuntary part-timers. This rate was unchanged at 14.7% over the month, although it is down from 16.4% a year ago. ...402 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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