
Hiring dropped sharply in May, the weakest in 6 years - MollyR
https://www.washingtonpost.com/news/wonk/wp/2016/06/03/hiring-drops-sharply-with-38000-jobs-added-in-may-unemployment-rate-falls-to-4-7-percent/
======
dforrestwilson1
The unemployment rate is not a good metric. The labor force participation rate
is more inclusive, and declined for the 2nd month in a row.

[http://www.nytimes.com/2016/06/04/business/economy/jobs-
repo...](http://www.nytimes.com/2016/06/04/business/economy/jobs-report-
unemployment-wages.html)

Furthermore the quality of available jobs appears to have declined.

~~~
baron816
> The unemployment rate is not a good metric. The labor force participation
> rate is more inclusive

LFP rate is not better than the unemployment rate. There are a lot of factors
that go into labor force participation, and demographics is probably the
biggest. It peaked in the late 90s and has pretty much followed the same
downward trend since:

[http://www.tradingeconomics.com/united-states/labor-force-
pa...](http://www.tradingeconomics.com/united-states/labor-force-
participation-rate)

~~~
dforrestwilson1
You're making my point for me. Demographics matter. The older bubble
demographic nearing retirement, and the new bubble demographic is not taking
up the slack.

[http://www.randalolson.com/wp-
content/uploads/united_states_...](http://www.randalolson.com/wp-
content/uploads/united_states_population_pyramid.jpg)

Unemployment also ignores the disability insurance bubble.

~~~
stinkytaco
Not taking up the slack implies there's something wrong with the new bubble
demographic. There appears to be less slack to take up. As you pointed out,
lower quality jobs.

------
kevenwang0531
News media ought to pay more attention to the confidence intervals associated
with these metrics. Uncertainty is always present in statistics and the
revisions to these numbers rarely get reported (it was reported in this case
to fit the tone of the story). News articles like these have a powerful
psychological effect on the public, so shouldn't the media do a more
responsible job by saying "oh by the way, it's 38,000 jobs +- 50,000"?

~~~
joobus
> For example, the confidence interval for the monthly change in total nonfarm
> employment from the establishment survey is on the order of plus or minus
> 115,000.

[http://www.bls.gov/news.release/empsit.tn.htm](http://www.bls.gov/news.release/empsit.tn.htm)

So 38,000 +- 115,000. In other words, they don't really know if employment
went up or down.

~~~
__derek__
Thanks for digging that up. I thought it was around 100,000 and was about to
go look for the actual number.

------
MollyR
For the curious, alternative measures of labor underutilization

[http://www.bls.gov/news.release/empsit.t15.htm](http://www.bls.gov/news.release/empsit.t15.htm)

------
ianai
This doesn't worry me so much on it's own. You have to contrast it with new
unemployment rates.

~~~
dragonwriter
> You have to contrast it with new unemployment rates.

IIRC, the concern is that hiring slowdowns tend to lead increases in
unemployment. But, yes, the unemployment rate (not just the headline rate, but
all of the alternative measures from BLS as well) is still dropping.

~~~
dev1n
the unemployment rate dropped because more people left the workforce and
became discouraged workers (a la haven't searched for work in the past 4
weeks).

~~~
dragonwriter
> the unemployment rate dropped because more people left the workforce and
> became discouraged workers

For the last monthly downtick, if you look at all the alternative measures
[0], that's not the case. Actually, what you see is that the headline
unemployment rate dropped, but the difference is mostly a shift from
unemployed to working part time for economic reasons; discouraged workers have
stayed about the same.

> (a la haven't searched for work in the past 4 weeks).

Discouraged workers are not "haven't searched for work in the past 4 weeks"
its that subset of the marginally attached ("those who currently are neither
working nor looking for work but indicate that they want and are available for
a job and have looked for work sometime in the past 12 months") who "have
given a job-market related reason for not currently looking for work." [0,
again]

[0]
[http://www.bls.gov/news.release/empsit.t15.htm](http://www.bls.gov/news.release/empsit.t15.htm)

------
generj
Well, that's worrisome. The hiring rate, along with new unemployment benefit
applications and various other stats is the an early indicator for the macro
economy.

~~~
MaysonL
It's a very noisy number, month to month.

------
waspleg
Got laid off yesterday. Hooray.

~~~
hourislate
Work is over rated. Just look at it as early retirement and consider yourself
lucky.

~~~
cylinder
Someone should go tell all those sweatshop workers and coal miners that work
is "overrated" and that they should all just retire early!

~~~
jwatte
Aren't the robots already doing that, and that's what the number tens are
telling us?

------
MaysonL
For a bit of perspective, see "Payroll Employment: Best Years, Worst Month"[0]

Non-Farm Payroll: Best Years, Worst Month

Year Annual (000s) Worst Month (000s)

1984 3,880 128

1994 3,851 200

1983 3,458 -308

1997 3,408 -39

1988 3,242 94

1999 3,177 107

1987 3,153 171

1998 3,047 124

1996 2,825 -18

1993 2,817 -49

2014 2,5851 142

2005 2,506 67

1985 2,502 124

2013 2,331 84

2012 2,236 88

1995 2,159 -16

2006 2,085 2

2011 2,083 70

2004 2,033 32

12014 is the hiring pace through August.

[0][http://www.calculatedriskblog.com/2014/09/payroll-
employment...](http://www.calculatedriskblog.com/2014/09/payroll-employment-
best-years-worst.html)

~~~
internaut
The pace of hiring has halved since 1984?

