Sunday, December 31, 2017

Labor Line

December 2017___________________________________

Labor line has job news and commentary with a one stop short cut for America's job markets and job related data including the latest data from the Bureau of Labor Statistics.

This month's job and employment summary data are below. This month's inflation data is below.

The Establishment Job Report and Establishment Job Details for data released December 8, 2017.

American Job Market The Chronicle

Current Job and Employment Data

Jobs
Total Non-Farm Establishment Jobs up 228,000 to 147,240,000
Total Private Jobs up 221,000 to 124,900,000
Total Government Employment down 7,000 to 22,341,000

Employment Note
Civilian Non-Institutional Population up 183,000 to 255,949,000
Civilian Labor Force up 148,000 to 160,529,000
Employed up 57,000 to 153,918,000
Employed Men down 29,000 to 81,630,000
Employed Women up 87,000 to 72,289
Unemployed up 90,000 to 6,610,000
Not in the Labor Force up 35,000 to 95,420,000

Unemployment Rate stayed the same at 4.1% or 6,610/160,529
Labor Force Participation Rate stayed the same at 62.7%, or 160,529/255,949

Prices and inflation measured by the Consumer Price Index (CPI) for all Urban Consumers was up by a monthly average of 1.26 percent for 2016.

The November CPI report for the 12 months ending with October, shows the

CPI for All Items was up 2.0%
CPI for Food and Beverages was up 1.3%
CPI for Housing was up 2.8%
CPI for Apparel was down .6%
CPI for Transportation including gasoline was up 3.2%
CPI for Medical Care was up 1.7%
CPI for Recreation was up 1.7%
CPI for Education was up 2.1%
CPI for Communication was down 5.1%

This Month's Establishment Jobs Press Report

A LITTLE LOWER THAN LAST MONTH

The Bureau of Labor Statistics published its December report for jobs in November. The labor force was up 148 thousand, which was a 57 thousand increase in the employed and a 90 thousand increase in the unemployed; 35 thousand of the monthly growth in the adult population did not enter the labor force. The increase in the employed was enough to offset the jump in the unemployed to keep the unemployment rate steady at 4.1 per cent. The labor force participation rate also held steady at 62.7 percent for November, following last month's big increase.

The seasonally adjusted total of establishment employment was up 228 thousand for November. The increase was 159 thousand more jobs in the private service sector combined with a 62 thousand increase in jobs from goods production. The total of 221 thousand more private sector jobs combined with an increase of 7 thousand government service jobs accounts for the total increase.

All three good production sub sectors had more jobs for November in an unusually good month for goods production. Natural resources had 7 thousand more jobs when jobs here usually decrease. The new jobs included 4.1 thousand more jobs in mining support employment, but few new jobs in mining or oil extraction. Construction added 24 thousand jobs with gains primarily in specialty contracting with 22.6 thousand more jobs. Building construction added some more jobs offset by a loss of 7.8 thousand jobs in heavy and engineering construction.

Manufacturing dominated goods production gains for November with 31 thousand more jobs distributed between 27 thousand new durable goods jobs and only 4 thousand more jobs in non-durable goods. Among durable goods, machinery added 8.3 thousand jobs, fabricated metal products added 7.4 thousand jobs and computer and electronic products, especially computer and peripheral equipment, added 3.8 thousand jobs. Among non-durable, food manufacturing and plastics had small gains offset by losses in other industries.

Government service employment was up a combined 7 thousand seasonally adjusted jobs for November. The federal government dropped 3 thousand jobs while combined state and local government picked up 10 thousand new jobs, which includes 7.3 thousand new jobs in public education. Private education was up again with 13.1 thousand jobs, making the combined increase in education employment 20.4 thousand new jobs for November.

Professional and business services had the largest increase for the month with 46 thousand more jobs, but still within a normal range for these three sub sectors. The professional and technical service sub sector picked up 23.5 thousand jobs of the total increase while management of companies was off 800 jobs; administration and support services including waste management had a net increase of 23.1 thousand jobs.

Among professional and technical services, management and technical consulting contributed another month of gain with 7.2 thousand jobs. Accounting and bookkeeping services added 4 thousand new jobs; computer design and related services another 3.8 thousand. Legal services picked up 600 jobs, but remains with a total of 1.3 million jobs, about the same employment as the last 15 years.

Among administrative and support services, temporary help services had the entire total of employment services, which was 18.3 thousand new jobs. Business support services added 3.1 thousand jobs, but all other sub sectors remained about the same.

Health Care had a slightly better than normal month with 41 thousand new jobs. All health care sub sectors had job gains, although hospitals, nursing and residential care had only small gains while ambulatory care added 25.3 thousand jobs and social assistance another 11 thousand jobs, a little above normal for social services. The November growth rate in health care employment was 2.48 percent, more than November a year ago and a little better than the 15 year trend of 2.31 percent. Health continues to be a larger share of national employment month by month, now at 13.3 percent.

Trade, transportation and utilities had an average month for jobs with 32 thousand new jobs, an increase about equal to the five-year growth trend. Transportation did well with 10.5 thousand new jobs, but like last month the gains came from warehousing and storage, 8.1 thousand new jobs, and for couriers and messengers, 2.2 thousand new jobs. Modal transportation including airlines had small losses. Wholesale traded added 3.4 thousand new jobs while retail added another of 18.7 thousand.

Leisure and hospitality had an off month with only a net of 14 thousand new jobs. The arts, entertainment and recreation sub sector had job losses of 7 thousand jobs with the amusements, gambling and recreation part of that leading the way downward with a loss of 5.8 thousand jobs. Performing arts and spectator sports also had small losses.. Accommodations added 2.3 thousand jobs; food services added 18.9 thousand jobs, less than expected given long term trends.

Information services dropped a net of 4 thousand jobs, a fourth month in a row of job losses. Motion picture and sound recording, broadcasting except the Internet and telecommunications all lost jobs offset by small gains in data processing and Internet services. Financial activities added a net of 8 thousand jobs, but both finance and insurance lost jobs. Like last month it was real estate and rental and leasing services that added jobs: 8.3 thousand, a little less than last month. The category, other services added 9 thousand jobs with all three sub sectors reporting gains. Personal and laundry services added 2.6 thousand jobs, an unusually large gain. Repair and maintenance services added another 3.5 thousand jobs; non-profit associations picked up 2.5 thousand jobs.

Establishment employment was up 228 thousand in November to 147.241 million jobs, a little lower gain than last month but an encouraging annual growth rate of 1.86 percent. To date there are no significant changes in government spending or taxation during the Trump period and the Federal Reserve Bank has controlled the money supply and interest rates in a reasonable and prudent manner. At least a decade of economic inertia continues to move the economy along. If the two tax bills passed by the House and Senate go into effect it will pull billions of dollars in transactions out of the spending stream and depress the economy. We will just have to wait and see the final result.

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November Details

Non Farm Total +228
The Bureau of Labor Statistics (BLS) reported Non-Farm employment for establishments increased from October by 228 thousand jobs for a(n) November total of 147.010 million. (Note 1 below) An increase of 228 thousand each month for the next 12 months represents an annual growth rate of +1.86%. The annual growth rate from a year ago beginning November 2016 was +1.43%; the average annual growth rate from 5 years ago beginning November 2012 was +1.78%; from 15 years ago beginning November 2002 it was .80%. America needs growth around 1.5 percent a year to keep itself employed.

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Sector breakdown for 12 Sectors in 000's of jobs

1. Natural Resources +7
Natural Resources jobs including logging and mining were up 7 thousand from October at 730 thousand jobs in November. An increase of 7 thousand jobs each month for the next 12 months would be a growth rate of +11.62 percent. Natural resource jobs are up 64 thousand for the 12 months just ended. Jobs in the 1990's totaled around 770 thousand. Job growth here will be small compared to America's job needs. This is the smallest of 12 major sectors of the economy with .5 percent of establishment jobs.

2. Construction +24
Construction jobs were up 24 thousand from October with 6.955 million jobs in November. An increase of 24 thousand jobs each month for the next 12 months would be an annual growth rate of +4.16 percent. Construction jobs are up 184 thousand for the 12 months just ended. The growth rate for the last 5 years is +4.13%. Construction jobs rank 9th among the 12 sectors with 4.7 percent of non-farm employment.

3. Manufacturing +31
Manufacturing jobs were up 31 thousand from October with 12.514 million jobs in November. An increase of 31 thousand jobs each month for the next 12 months would be an annual growth rate of +2.98 percent. Manufacturing jobs were up for the last 12 months by 189 thousand. The growth rate for the last 5 years is +.93%; for the last 15 years by -1.20%. In 1994, manufacturing ranked 2nd but now ranks 6th among 12 major sectors in the economy with 8.5 percent of establishment jobs.

4. Trade, Transportation & Utility +32
Trade, both wholesale and retail, transportation and utility employment was up 32 thousand from October at 27.470 million jobs in November. An increase of 32 thousand each month for the next 12 months would be an annual growth rate of +1.40 percent. Jobs are up by 124 thousand for the last 12 months. Growth rates for the last 5 years are +1.39 percent. Jobs in these sectors rank first as the biggest sectors with combined employment of 18.7 percent of total establishment employment.

5. Information Services -4
Information Services employment was down 4 thousand from October at 2.703 million jobs in November. A decrease of 4 thousand each month for the next 12 months would be an annual growth rate of -1.77 percent. (Note 2 below) Jobs are down by 65 thousand for the last 12 months. Information jobs reached 3.7 million at the end of 2000, but started dropping, reaching 3 million by 2004, but now holds in the 2.7 million range. Information Services is a small sector ranking 11th of 12 with 1.9 percent of establishment jobs.

6. Financial Activities +8
Financial Activities jobs were up 8 thousand from October at 8.492 million in November. An increase of 8 thousand each month for the next 12 months would be an annual growth rate of + 1.13 percent. Jobs are up 150 thousand for the last 12 months. (Note 3 below)This sector also includes real estate as well as real estate lending. Financial Services has been growing slowly with many months of negative growth. The long term growth rates are now at a 5 year growth rate of +1.68 percent, and a 15 year growth rate of +.40 percent. Financial activities rank 8 of 12 with 5.8 percent of establishment jobs.

7. Business & Professional Services +46
Business and Professional Service jobs went up 46 thousand from October to 20.928 million in November. An increase of 46 thousand each month for the next 12 months would be an annual growth rate of +2.64 percent. Jobs are up 548 thousand for the last 12 months. Note 4 The annual growth rate for the last 5 years was 2.92 percent. It ranks as 2nd among the 12 sectors now. It was third in May 1993, when manufacturing was bigger and second rank now with 14.2 percent of establishment employment.

8. Education including public and private +20
Education jobs went up 20 thousand jobs from October at 14.082 million in November. These include public and private education. An increase of 20 thousand jobs each month for the next 12 months would be an annual growth rate of+1.74 percent. Jobs are up 145 thousand for the last 12 months. (note 5) The 15 year growth rate equals +.74 percent, slower than the national average. Education ranks 4th among 12 sectors with 9.6 percent of establishment jobs.

9. Health Care +41
Health care jobs were up 41 thousand from October to 19.616 million in November. An increase of 41 thousand each month for the next 12 months would be an annual growth rate of +2.48 percent. Jobs are up 388 thousand for the last 12 months. (note 6) The current month was above long term trends and greater than growth from a year ago when the annual growth rate was +2.02 percent. Health care has been growing at +2.31 percent annual rate for the last 15 years, a rate greater than the national rate. Health care ranks 3rd of 12 with 13.3 percent of establishment jobs.

10. Leisure and hospitality +14
Leisure and hospitality jobs went up 14 thousand from October to 16.018 million in November. An increase of 14 thousand each month for the next 12 months would be an annual growth rate of +1.05 percent. Jobs are up 279 thousand for the last 12 months. (note 7) The 5 year growth rate is 2.86%. More than 80 percent of leisure and hospitality are accommodations and restaurants assuring that most of the new jobs are in restaurants. Leisure and hospitality ranks 4th of 12 with 10.9 percent of establishment jobs. It moved up from 7th in the 1990's to 5th in the last few years.

11. Other +9
Other Service jobs, which include repair, maintenance, personal services and non-profit organizations went up 9 thousand from October to 5.798 million jobs in November. An increase of 9 thousand each month for the next 12 months would be an annual growth rate of +1.87 percent. Jobs are up 80 thousand for the last 12 months. (note 8) Other services had +.47 percent growth for the last 15 years. These sectors rank 10th of 12 with 3.9 percent of total non-farm establishment jobs.

12. Government, excluding education +1
Government service employment was up 1 thousand from October to 11.944 million jobs in November. An increase of 1 thousand each month for the next 12 months would be an annual growth rate of +.05 percent. Jobs are down 14 thousand for the last 12 months. (note 9) Government jobs excluding education tend to increase slowly but surely with a 15 year growth rate of +.16 percent. Government, excluding education, ranks 7th of 12 with 8.1 percent of total non-farm establishment jobs.

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Sector Notes___________________________

(1) The total cited above is non-farm establishment employment that counts jobs and not people. If one person has two jobs then two jobs are counted. It excludes agricultural employment and the self employed. Out of a total of people employed agricultural employment typically has about 1.5 percent, the self employed about 6.8 percent, the rest make up wage and salary employment. Jobs and people employed are close to the same, but not identical numbers because jobs are not the same as people employed: some hold two jobs. Remember all these totals are jobs. back

(2) Information Services is part of the new North American Industry Classification System(NAICS). It includes firms or establishments in publishing, motion picture & sound recording, broadcasting, Internet publishing and broadcasting, telecommunications, ISPs, web search portals, data processing, libraries, archives and a few others.back

(3) Financial Activities includes deposit and non-deposit credit firms, most of which are still known as banks, savings and loan and credit unions, but also real estate firms and general and commercial rental and leasing.back

(4) Business and Professional services includes the professional areas such as legal services, architecture, engineering, computing, advertising and supporting services including office services, facilities support, services to buildings, security services, employment agencies and so on.back

(5) Education includes private and public education. Therefore education job totals include public schools and colleges as well as private schools and colleges. back

(6) Health care includes ambulatory care, private hospitals, nursing and residential care, and social services including child care. back

(7) Leisure and hospitality has establishment with arts, entertainment and recreation which has performing arts, spectator sports, gambling, fitness centers and others, which are the leisure part. The hospitality part has accommodations, motels, hotels, RV parks, and full service and fast food restaurants. back

(8) Other is a smorgasbord of repair and maintenance services, especially car repair, personal services and non-profit services of organizations like foundations, social advocacy and civic groups, and business, professional, labor unions, political groups and political parties. back

(9) Government job totals include federal, state, and local government administrative work but without education jobs. back

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Notes

Jobs are not the same as employment because jobs are counted once but one person could have two jobs adding one to employment but two to jobs. Also the employment numbers include agricultural workers, the self employed, unpaid family workers, household workers and those on unpaid leave. Jobs are establishment jobs and non-other. back

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Monday, December 4, 2017

A Tax Bill to Depress the Economy

A Tax Bill to Depress the Economy

The so-called tax bills just passed by the House and Senate will depress the economy, which is easy to understand.

Governments rapidly return all of their tax money to the economy for salaries, schools, health care, defense contractors, road building and plenty more. They tend to put tax money into the spending stream as it arrives generating spending for, and income to, millions of people widely dispersed in all the states. Federal tax money tends to be spent in the United States and therefore supports the domestic economy.

To cut taxes by billions and billions to enrich a small number of people and corporations with no need to return that buying power to the spending stream guarantees a slowdown. A look at annual Corporate 10K reports often finds billions sitting as cash in liquid accounts. Corporations are slow to return revenues and profits to the spending stream and they have no obligation to spend in the United States. Tax money that once supported our domestic economy will end up going abroad.

The rich speculate in stocks and real estate and trendy collectibles and bid up the price of things that already exist, all of which creates nothing much for employment or the economy. Recall the Credit Default Swaps and Collateralized Debt Obligations after the Bush era tax cuts, and the depression that followed.

Claims that tax breaks to the rich creates a bigger supply of capital to finance investments ignores the need for demand and the mass buying power that cannot exist in a country with the crude and extreme inequality of the United States and tax bills to make it worse.

The bloated and privileged rich can do nothing to benefit the country or the economy buying the Congress and helping themselves to the country’s buying power. Some of us think the wealthy and the Congress have a responsibility to support the welfare of the larger society. Instead they act like marauders and midnight looters, pillaging and laying to waste.