It was the first Friday in August. The time slowly inching its way to 8:30 am. It’s only a few agonizing minutes until the jobs number was to be revealed just as it is the first Friday of every month.
The experts had weighed in with their forecast and were bracing the nation for a disappointing number – having predicted 258,000 jobs. This was a precipitous drop from the 372,000 jobs created in July.
A decline in the jobs created made total sense to SCG. We have closely tracked layoffs for select industries over the past nine years. Those layoffs have been increasing every month over the past 6 months. Those eventually should be reflected in the unemployment rate. Right?
But then, the Bureau of Labor Statistics threw us all a huge curve. They announced the number for jobs created was over double that the experts had anticipated. It came in at an unbelievable 528,000. That’s more than twice the initial projection. With 3.5% unemployment.
What goes into the Bureau’s calculations?
The report is based on two separate surveys.
The Establishment Survey gathers information from 145,000 nonfarm businesses and government agencies for some 697,000 work sites and about one-third of all payroll workers.
This data estimates the number of people on payrolls in the U.S. economy, the average number of hours they worked weekly, and their average hourly earnings, along with several versions of the unemployment rate.
The Household Survey is based on monthly interviews of 60,000 households by the Census Bureau. The participants provide their employment status during the week including the 12th day of the month. The BLS measures unemployment by dividing the total number of unemployed people looking for a job by the total number of individuals in the labor force.
Here is the official report based on the July data.
As impressive as that number is, we cannot sustain 500,000+ new jobs per month with the 3.5% unemployment. Just not enough talent. That is made even more difficult with the nation’s continually shrinking Employment Participation Rate (the percentage of individuals who are working or actively looking for work).
Why is this report essential to recruiters?
SCG sees this information as vital insight into the competitiveness of the recruitment landscape. As the market tightens, recruiters face the need for increased budgets and use of invasive strategies to reach the more plentiful – but less persuadable – passive candidates.
For a deeper dive…
Open the July Data link above and scroll to the bottom. You will find access to about 25 in-depth reports.
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