What struck me most was not the absolute Payroll number, but the continuing disconnect between the Payroll Survey and the Household Survey, although this time flip-flopped. Previously we had the Household Survey showing strong growth but no follow through on the Payroll numbers. Now we have 308K growth from the Payroll source, and a DROP in the Household number with an increase in the unemployment rate from 5.6% to 5.7%. Suggests to me there is a time lag effect here, with the larger Payroll data less responsive in the short run.
In any case, the strong Payroll number may well provide the impetus for the push to a final set of highs in the cyclical bull. If there is, in fact, a time lag here, and the Household number foreshadows drastic slowing in the Payroll number, the selloff from those highs could well be swift and savage.
Like the government's inflation numbers, one wonders just how accurate the jobs report is. Do they count the self-employed? Discouraged workers? Temporary jobs? Part-time work? The list goes on and on how some "jobs" are counted and some not... how some "unemployed" are counted and some not.
I first started to wonder about the accuracy of government statistics in the Clinton years. Very easy to manipulate.
I think accuracy in sampling is always an issue. I doubt manipulation of the BEA. It does seem like somebody leaked this particularly gleeful set to the Administration. The potential irony in it is if it encourages your discouraged workers to reenter the labor force, and there is no follow through on job creation, that nice smooth downward trend in the unemployment rate will make a sudden U-Turn back up to that 6-6.1% range. Will make the politicos wish they hadn't given the monthly increase so much publicity.
Suppose all the workers that gave up looking for a job. The 2 million jobs lost by outsourcing and left out of the BLS decided to look for a job this month. Then the bureau of Lies and Stats would have to relist them on the Statistics for people unemployed.
When I was in college the professor taught us to "fudge" the "factors" to make the formula work.
Hence the unofficial rate should be over 9% Unemployed. Is that possible? Or does the government deny these people exist?
But, politically speaking, hey the economy is on a ROLL and Jobs are everywhere.
Happy Days are Here Again! and The Good Times are Here to Stay!
I could use the Same arguement why stocks can rise in the election year cycle.
So interest rates are implied Higher and the Stock Market is Higher.
Cruel irony that new home construction jobs led payroll #'s. This is the very sector that will feel the pinch in a rising rate enviornment. Sell off of NFI/IMH could create a buying opportunity but they're still so high after recent runup.