President Joe Biden, administration officials, and the White House’s allies in the mainstream media are celebrating the December jobs report, capping off a year that saw about 2.7 million new jobs. While the labor market is ostensibly slowing down from the previous year, the headline figures suggest that conditions remain solid. But everyone is betting on the public not diving deeper into the latest Bureau of Labor Statistics’ (BLS) employment figures. Not everyone would be popping open a bottle of champagne if they did.
A Primer: The December Jobs Report
The US economy added 216,000 new jobs in December, up from a downwardly revised 173,000 in November. This also exceeded market expectations of 170,000. The unemployment rate was flat at 3.7%, meaning the jobless figure has been below 4% for 23 consecutive months, a record. Average hourly earnings rose to a higher-than-expected 4.1% year-over-year, average weekly hours slid to 34.3, and the labor force participation rate plunged to 62.5%. These were the primary numbers that everyone paid attention to, but a deeper dive presents a much different labor arena.
Work for the State
The government was the chief job creator in December, with payrolls rising 52,000. On average, the government added 53,000 new jobs per month in 2023, about double from the previous year. Overall, the Leviathan accounted for a quarter of new jobs in December. The Swamp Monster added 676,000 to the US economy for the year, representing one-quarter of all employment growth.
Meanwhile, leisure and hospitality added 40,000 positions. Healthcare and social assistance were next on the list, climbing 38,000 and 21,000, respectively. Construction and retail each contributed 17,000 to the final tally. Transportation and warehousing jobs fell 17,000, and manufacturing was little changed with 6,000 new positions.
Half A Million Jobs Vanish
As Liberty Nation predicted in the December jobs report preview, the BLS revised the labor data again. Statisticians adjusted the October and November jobs data lower. The October non-farm payroll employment total was revised down by 45,000 to 105,000. The November report was cut by 26,000 to 173,000. From January to November, 500,000 positions vanished from the national economy. There is little reason to think the same thing will not occur next month.
Jobs Grow, Employment Falls?
(Photo by: Jeffrey Greenberg/Universal Images Group via Getty Images)
One component of the December jobs report raised eyebrows and even prompted CNBC hosts to scratch their heads: There were new jobs, but employment levels fell. While there were more than 200,000 new jobs, employment in America declined by 676,000. What gives? Well, there could be a few explanations for this quandary.
First, more people left the workforce last month, which helps explain the sharp drop in the labor force participation rate. Second, the number of people working two or more jobs climbed to a seasonally adjusted 8.565 million. Third, the household survey portion, which counts individuals with jobs only once, highlighted the sharp decline in total employment.
There was another fascinating turn of events in the December jobs report: full-time jobs compared to part-time positions. The former saw approximately 1.5 million vanish from the economy, while the latter increased 762,000. Plus, there was a substantial boost to the number of self-employed individuals, rising nearly 300,000 to just over ten million.
Be Afraid?
Unsurprisingly, the White House championed the recent figures. “This morning’s report confirms that 2023 was a great year for American workers,” President Biden said in a statement. If you only assess the top two figures – new jobs and the unemployment rate – then yes, it was a terrific time for the American worker. However, for much of the last year, the BLS data provided a grim look at the US labor market and potentially raised more eyebrows than Monica Bellucci.
From the explosion in government jobs to the decline in temporary worker services, a chorus of economists will aver that the labor data could be signaling a downturn. Of course, as they say, the recession is always six months away. But for the economic forecasters, it could be challenging to produce a reliable projection when the statistics are broken.
