One of the most important economic releases to come out each month is the Employment Situation Summary report issued by the Bureau of Labor Statistics. This report presents a range of data series related to the nation’s employment and unemployment. The report is compiled by the BLS and the Bureau of the Census, and contains data from two separate surveys: The Establishment survey, which collects data from a sampling of more than 400,000 businesses across the country, and the Household survey, which is based on a sampling of about 60,000 households. It is the most comprehensive look at the labor market until the annual GDP numbers are released – generally 3 months after the end of a given year.
As with the GDP report, the headline statistics on unemployment point toward good news, with the overall unemployment rate falling to just 7.0 percent in November. But just like the report on the overall economy, the devil is in the details. In fact, based on the November report, while the number of employed persons between October and November grew by over 802,000, the figure is still just above that in September. In fact, most of the growth is due to the end of the partial federal government shutdown, and the number of work-eligible people not participating in the labor force rose by 664,000 since September.
The more detailed establishment data also present a different picture. According to this survey, in November, the number of jobs was up by just 203,000 (about a quarter of those in the household survey). This reflects different accounting since the household data reflect a less exacting definition of employed. Between October and November, most job growth occurred in the education and health care industries, followed by business services and transportation. Retail sector growth, while important, came in fourth with just 25,000 more jobs.
Something that is not often reported is how unemployment impacts different occupational categories. Depending on the type of occupation that one pursues, there is a significant difference in unemployment rates. In fact, for those involved in agricultural occupations like farming and forestry, the unemployment rate is 180 percent of the national average. This is in spite of growing production in the farm sector. In addition, even though the housing market has strengthened, unemployment in construction occupations is 156 times that of the general rate of unemployment, while those in manufacturing occupations face an unemployment rate that is nearly 20 percent above the average. On the other hand, people involved in professional occupations have little unemployment with a rate of under half the national average. Management professions and craftsmen and those who repair things also face significantly less job pressure.
A lot has been said about how the American labor force is not changing rapidly enough to account for employment demand, and these differences confirm that story. The unemployment rate for college graduates is only 3.4 percent which is nearly full employment. This is in spite of all of the bad press about graduates not being able to find jobs. If these people are trained for management and technical occupations, jobs are plentiful, and the real issue is likely that entry level jobs even in technical and management occupations don’t pay enough to cover high student loan debts. On the other hand, high school dropouts face significantly worse employment prospects. The high rates of unemployment in construction, manufacturing and agricultural occupations bear this out. While the government focuses on monetary policy as a means to reduce unemployment, it may be more likely that better educational policies would have more of an impact.
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