February Jobs Report: Another Warning Signal on the Economy?

By at 8 March, 2024, 3:52 pm

by Raymond J. Keating – 

The latest jobs report from the U.S. Bureau of Labor Statistics, more than anything else, raises questions and generates more uncertainty about the economy.

The two surveys that the report is based on offer conflicting information.

First, the establishment survey, which tends to offer data from larger, more established businesses, estimated that nonfarm payroll employment grew by a solid 275,000 in February. Great, right?

Well, yes, except for the fact that the household survey offered a different take. The household survey – which better captures startup and small business activity but also is more volatile month to month – indicated that employment declined by 184,000 in February.

Those are very different assessments, to say the least.

The household survey also noted that the labor force participation rate remained unchanged in February at 62.5 percent, while the employment-population ratio declined from 60.2 percent in January to 60.1 percent in February.

It’s actually not that unusual for the two surveys to offer different estimates on jobs during a particular month. But over time, the employment numbers in the surveys wind up moving in the same direction.

The question, of course, is: Which direction?

Given the enormous policy questions we face, and recent less-than-positive takes on other aspects of the economy (see SBE Council’s analysis here), concerns run high.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His latest books on the economy are The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist, The Weekly Economist II: 52 More Quick Reads to Help You Think Like an Economist and The Weekly Economist III: Another 52 Quick Reads to Help You Think Like an Economist.


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